< The 2016 All-Europe Research Team
Mislav Matejka
& team
J.P. Morgan Cazenove
First-Place Appearances: 4
Total Appearances: 8
Team Debut: 2009
J.P. Morgan Cazenove earns its fourth consecutive first-place finish, fielding a five-person group that works out of London and Mumbai. Directed by Mislav Matejka, 39, the strategists “have a sensible approach to equity allocation between sectors and themes,” one money manager attests. For the past seven years, Matejka and his associates had been bullish on European markets, but the “equity outlook is becoming less favorable,” he cautions, so they are changing course. Valuations are not attractive in absolute terms, with the regional market trading at the top of a 15-year range on price-to-sales and price-to-earnings metrics, he explains, and credit spreads are widening. At the same time, “corporate balance sheets have leveraged up, due to big buyback programs, and profit margins could be rolling over given negative operating leverage,” Matejka notes, while the prospect of further devaluation of China’s renminbi “could be problematic for equities.” The strategists, consequently, are advising clients that they “should be selling any rally and not buying the dips anymore,” he reports. “We think value sectors could start to do better than growth but only once the dollar index has peaked.”