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Industry Sectors: Pharmaceuticals

Holding steady at No. 1 for a second straight year is the BofA trio led by Graham Parry, 36.

Graham Parry & team BofA Merrill Lynch

second teamAmit Roy & team Nomura

third teamJohannah Walton, Matthew Weston & team Credit Suisse

Holding steady at No. 1 for a second straight year is the BofA trio led by Graham Parry, 36. The analysts, who according to one ­money man­ager have a “spectacular sense of drugs and their market potential,” told clients in March to stock up on shares of U.K. specialty-­drug maker Shire, on the belief that a new marketing partnership with Britain’s GlaxoSmithKline would boost sales. By late December, Shire’s stock had risen a very healthy 40.5 percent, from 861.19p to 1,210p, and outperformed the sector by 15.9 percentage points. Nomura repeats in second place, this time under the direction of Amit Roy, who joined the firm in January 2009. The three-­member team provides “invaluable guidance on the approval process and how doctors actually operate,” says one investor. In June, after concerns about the safety of its diabetes drug Lantus had driven shares of Paris-­based Sanofi-­Aventis down to €40.85, the team issued a short-term, valuation-­based buy recommendation, saying investors had overreacted. A month later, after the stock had gained 12 percent, to €45.77, the analysts downgraded it to neutral, again on valuation. The downgrade was premature, however; the stock closed the year at €55.06. Last year, Johannah Walton and ­Matthew Weston co-led Nomura’s No. 2 team; the analysts moved to ­Credit ­Suisse in January 2009 and lead their new team to third place. (The ­Credit ­Suisse squad was unranked last year.) The five-­member crew offers an “admirable focus on fundamentals,” says one longtime fan. Low valuation prompted the analysts to recommend German drug giant Bayer in July, at €37.35. The stock had zoomed to €55.96 by late December, a gain of 49.8 ­percent.

To go back to the index page, click on the Best European Analysts of the Year: 2010 All-Europe Research Team.

To read the article, click on: Reversal of Fortunes: The 2010 All-Europe Research Team

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