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2016 All-Asia Research Team: Equity Strategy, No. 2: Jonathan Garner & team

No. 1 last year, Morgan Stanley’s equity strategy crew slips to second place.

Jonathan Garner & team
Morgan Stanley
First-place appearances: 3

Total appearances: 12

Team debut: 1996

No. 1 last year, Morgan Stanley’s equity strategy crew slips to second place. Even so, Jonathan Garner and his 11-person team in Hong Kong continue to win client praise for their thorough reporting. Their “‘Outlook’ pieces published in late 2015 really helped set the scene for what to expect in 2016,” reports one reader, who adds that their “weekly strategy briefings keep me up to date with nearer-term news flows, which have important implications across Asia.” For the balance of 2016, the researchers recommend that investors be “cautious on equity index performance,” says Garner, because they expect “a second year of declining earnings in a subdued growth environment.” While being pointedly circumspect on the banking, energy, industrials and materials sectors in much of Asia ex-Japan, they hold as exceptions quality companies that offer elevated returns on operating assets and minimal debt, as well as “high dividend yield and free cash flow,” the 51-year-old leader advises. Regarding individual country markets, the analysts endorse overweighting South Korea and Taiwan, which should benefit from superior earnings gains thanks to the “introduction of new product cycles” in the information technology sector, Garner explains. They are likewise bullish on the Philippines, he adds, because the nation “has a strong demographic and reform dynamic translating to above-average growth.”

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