Sunil (Nik) Modi reprises his second-place finish, extending his streak to five years. Modi left UBS this summer to cover consumer stocks at RBC Capital Markets, which he joined in September. “In brief, Nik seems to have his finger on the pulse,” says one money manager. “He always seems to have the latest information flow, plus the rumors floating around.” Modi demonstrated his ability to get the timing right in his calls on Richmond, Virginia–based Altria Group. In January 2012 he dubbed Altria his top pick, at $28.56, expecting that market share for one of the company’s major brands, Marlboro, would stabilize. In July, when the shares had leaped 23.9 percent, to $35.40, outperforming the sector by 9.6 percentage points, Modi downgraded them to neutral. “Our original thesis had played out,” he explains, “and we had concerns over the impact of Marlboro’s new brand architecture on its nonpromoted volume, heightened by promotional intensity in the second half of 2012 and the impact of bloated retailer inventories on near-term results.” The shares dropped to $31.24 in November, prompting the analyst to upgrade them to buy. The promotional environment — or price discounting — had abated, he maintained. By July, when Modi discontinued coverage in anticipation of his departure from UBS, the shares had climbed back to $35.06. — Katie Gilbert |
The 2013 All-America Research Team: Tobacco, No. 2: Sunil (Nik) Modi