The 2014 All-Europe Research Team: Specialty & Other Finance, No. 3: Philip Middleton & team

Philip Middleton steers his London-based Bank of America Merrill Lynch twosome from runner-up to third place. In general, the team advises, regional economic recovery over the past year has benefited the sector. “The issue now is that although the macro backdrop is supportive, valuation has moved to reflect this,” says Middleton. “So the focus now ought to be much more on stock-specific matters.” The researchers’ sector portfolio spans 16 names, seven of which they recommend investors buy. These are British emerging-markets fund manager Ashmore, market operators Deutsche Börse of Germany and London Stock Exchange Group of the U.K., Italian diversified financial services provider Mediolanum, private equity firms Partners Group Holding of Switzerland and 3i Group of the U.K., and British asset manager Schroders. “Of these, mathematically, Mediolanum offers the most upside,” says Middleton. “We like the fact that the Italian asset gatherers offer the prospect of continued asset inflows as they gain market share from the Italian banks,” he explains. “Mediolanum is one of the clear beneficiaries of this, and its valuation is attractive.”