Economics & Strategy – Middle East & North Africa Equity Strategy: Third

Despite slipping from second place to third, the 37-strong EFG-Hermes troop continues to win praise for “staying on top of events” as political unrest has roiled the region, according to one buy-side backer. Simon Kitchen, who works out of Cairo, shares leadership responsibilities this year with Dubai-based newcomer Ahmed Gad. The analysts cover 130 stocks in nine countries. Their current favorites include First Gulf Bank, a financial services provider headquartered in the United Arab Emirates, on robust loan growth and management’s “commitment to optimizing capital,” Kitchen says. Also recommended: Saudi International Petrochemical Co. “Earnings will be relatively muted year-over-year in 2013, but the company offers strong future growth prospects and an attractive dividend yield of circa 6 percent,” he explains. And in January the team reiterated its buy on Talaat Moustafa Group Holding Co., one of Egypt’s largest property developers. “Real estate investment is a good hedge against higher inflation and currency devaluation, both of which we expect in Egypt this year,” Kitchen states. — Paul Sweeney