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The 2014 Latin America Research Team: Chile, No. 2: Cesar Medina, Guilherme Paiva & team
Total appearances: 3
Team debut: 1994
After a two-year absence from this roster, Morgan Stanley returns with its best showing to date, capturing second place. New York–based Guilherme Paiva and Cesar Medina, a newcomer in this sector, steer this group and a team that merits a runner-up position for its reporting on Argentina. Separately, Paiva directs the top-ranked squad in Equity Strategy and a crew that captures a runner-up spot in Brazil coverage, and Medina guides the No. 1 team in tracking North Andean Countries. Investors laud the analysts for their “distinctive analysis, vast experience and active attitude to discuss and share opinions,” in the words of one portfolio manager. Another client cheers their “gathering and using [of] a broad selection of statistics to base recommendations.” In February, with Chile’s shares down 25.7 percent over the preceding 12 months and trailing the broader market by 12.7 percentage points, the analysts upgraded the group from sell to neutral. By late July those equities had climbed 10.3 percent, but they still lagged their emerging-markets peers by 4.6 percentage points. The Morgan Stanley researchers don’t expect to see a dramatic, sustained rise anytime soon. “We have very little visibility about a potential positive inflection point in the level of domestic economic activity,” Paiva says. “Right now it looks more and more likely to occur only in 2015.” For that reason two of the team’s favorite names are Empresas Copec, a forestry and energy concern headquartered in Santiago that has limited exposure to Chile’s economic cycle, generating three fourths of its earnings abroad; and Santiago-based Empresa Nacional de Electricidad, better known as Endesa Chile, which is the nation’s largest electricity generator and could outperform during a prolonged economic slowdown.