It started with a simple assignment. “Gil Kaplan came into my office one day and said, ‘We’ve got to do a story about the best analysts on Wall Street,’” recalls Peter Landau, editor of this magazine from 1972 to 1991. Brokerage firms seeking business from institutional investors - which had grown during the previous decade to dominate the financial markets - quickly embraced research as a competitive tool. Kaplan founded Institutional Investor in 1967 to serve this audience and believed readers would want to know which analysts provided the best research.
The idea for our approach came as many do in journalism - over drinks. That evening Landau went out with Wayne Welch, managing editor of an affiliated magazine called Corporate Financing, which was later folded into II. The two chatted about work. “It was around when baseball played the All-Star game, and Wayne said, ‘Why don’t you use that as a theme?’ I told him, ‘I can’t. It’s going to be for October,’ and then I thought I could call it the All-America Research Team instead and put these guys in football uniforms. We laughed and laughed. Little did we know it would become this huge thing on Wall Street.”
That was in 1972. This year marks the 30th anniversary of the All-America Research Team. Over time the team has grown in size (there are 79 sectors this year, compared with 26 in our inaugural version) and importance to the industry whose members it ranks. Assembling the team has become ever more firmly a key part of our editorial effort as we ensure that it is compiled according to the highest standards of objectivity and impartiality. The first team was selected by our journalists interviewing key buy-side figures; now we count tens of thousands of votes from buy-side analysts and portfolio managers who are asked to rank which analysts have been the most valuable in a given sector.
The 1972 team remains a distinguished group. Here is a look at what the original first-teamers have been up to since then.
Automobiles Ronald Glantz Laird ¥ In 1997, after a 29-year career in sell-side research, Ron Glantz planned to set down his spreadsheets and travel the world with his wife. Then Julian Robertson got wind of his plan. “He said, ‘You’re not retiring. You’re going to come and work for me,’” recalls Glantz, the No. 1 auto analyst in 1972. Glantz, 59, worked at Tiger Management until Robertson stopped managing outside money last year.
The onetime management consultant began his Wall Street career at Laird in 1968. He moved to Mitchell, Hutchins & Co. in 1972, remaining through the firm’s acquisition by PaineWebber, where he became head of research before leaving for stints at Montgomery Securities and Dean Witter Reynolds. He appeared 17 times on the AART team, including seven as No. 1. At Laird Glantz won a reputation for issuing - this is not a misprint - sell recommendations. “I was always willing to say sell,” he says.
Building Thomas Stiles Laird ¥ Many young analysts find a livelihood in Wall Street research. Thomas Stiles found a wife. Stiles, a four-year veteran of Laird, joined Smith, Barney & Co. in 1972, just weeks after being named our top Building analyst. He made the team seven times, including four appearances as No. 1. When he became head of that firm’s research department in 1978, his replacement was Barbara Alexander (a three-time first-teamer in the 1980s). Stiles left for E.F. Hutton & Co. in 1982. “One thing led to another, and Barbara and I have been married for close to 20 years,” he says.
Stiles ran E.F. Hutton’s research department until its acquisition in 1988 by Shearson Lehman Brothers. In 1995 he became chief investment officer of Smith Barney’s fund arm, retiring two years ago at 60. Stiles and his wife live in a house overlooking the ocean in Laguna Beach, California, where he runs his own portfolio. “I’m far from a day trader, but I’m having a lot of fun,” he says.
Cosmetics Joan Farr Oppenheimer & Co. ¥ “It was very much a boys’ club, but I never felt I was denied any opportunities,” says Joan Farr, the only female member of II’s first All-America team, speaking about Wall Street in the early 1970s. Among the companies she followed were Avon Products and Revlon. “Hair spray was big,” says Farr, who graduated from Radcliffe College in 1953. She started out as an office clerk at Merrill Lynch and in 1956 helped form the Financial Women’s Association of New York.
In the early 1960s Farr worked at Scudder, Stevens & Clark; she joined Oppenheimer & Co. in 1968. She repeated as a first-teamer in 1973, then opted to spend more time raising her two young children, taking a part-time job at MacKay-Shields Financial Corp. in New York.
In 1978 Farr joined Bank of New York as assistant research director. Today she is a BoNY portfolio manager overseeing about $500 million in high-net-worth assets. Says Farr, “I never really thought of myself as a trailblazer.”
Electronics/Technology Otis BradleySpencer Trask & Co. ¥ Otis Bradley was making $13,000 a year as an air force navigator in Roswell, New Mexico, in 1957, when he took a $9,000 pay cut to join Spencer Trask & Co. Fifteen years later, at age 40, he was named the top analyst in the electronics and technology sector. His boss, Edus Warren, told him the firm wouldn’t trumpet the honor. “He said, ‘Congratulations, but we’re not going to publicize it because it might hurt morale among the other guys,’” Bradley recalls.
Bradley, 69, made five team appearances, repeating at No. 1 in 1973, and rose to become research director, remaining at Trask, through several mergers, until 1978. He then moved to Alex. Brown & Sons, where he spent ten years. After Black Monday Bradley says he was “essentially fired. I was the oldest guy in the department, I was making the most money, and I recommended selling every stock I covered in August 1987, when the research director had been 100 percent bullish.”
Bradley became research director at H.C. Wainwright & Co. and in 1992 moved to Gilford Securities as research director. “Nobody thinks Gilford has good research, and we actually have phenomenal research,” says Bradley.
Forest Products Lawrence Ross Mitchell, Hutchins & Co. ¥ During a long career in research, Lawrence Ross appeared on the All-America team 22 times, including four times in first place. He died last August at age 69. In all he spent 23 years at Mitchell, Hutchins & Co. and its successor, PaineWebber, where he worked as a paper industry analyst until 1995. After a brief stint at Dillon, Read & Co., Ross started a consulting firm in 1997 out of Snowmass, Colorado, and organized panel discussions for San Francisco-based International Pulp and Paper, an industry lobby. Insightful analysis seems to run in the family. Four times in the mid- to late 1990s, Ross’s nephew David Dwyer, of Salomon Smith Barney, was the top-ranked building materials analyst. “You could say I wanted to be like my Uncle Larry,” Dwyer says. “We were very close.”
Lodging Dennis Leibowitz Coleman & Co. ¥ “I can’t quite remember what I was even covering back then,” says Dennis Leibowitz. For the record it was lodging, and his firm was Coleman & Co. His confusion is understandable: The nimble Leibowitz has been a highly influential analyst in the media and entertainment category for three decades. He’s also the analyst who purportedly “discovered” cellular technology in the early 1980s. Since 1972 he boasts 49 team appearances, including 25 first places, a Wall Street record.
“In the early days broadcasting and what little there was of cable wasn’t enough to justify my existence, so I had lodging and restaurants as well,” says Leibowitz, 60. “Over the years media became much bigger.” Leibowitz spent much of his career at Donaldson, Lufkin & Jenrette, which Credit Suisse First Boston bought last year. He now serves as CSFB’s director of media strategy.
Office Equipment David Hathaway G.A. Saxton & Co. ¥ David Hathaway likes to keep moving. After leaving G.A. Saxton & Co. in 1975, when he repeated as a first-teamer in Office Equipment, he jumped to Automatic Data Processing, running the company’s corporate development program for five years. In 1979, at a friend’s suggestion, he shifted gears again, this time into venture capital at Sprout Group. Hathaway in 1980 joined Venrock Associates, the Rockefeller family’s venture capital firm, where he is now a managing general partner. “In my 22nd year, the learning curve is still very steep,” says Hathaway of venture capital.
When he’s not working, Hathaway, 57, joins his wife at their farm in Dutchess County, about two hours north of New York City.
Publishing J. Kendrick Noble Jr. Auerbach, Pollak & Richardson ¥ A Princeton University graduate and retired naval captain, Noble began his career on Wall Street in 1965, after his family sold its textbook publishing company, Noble & Noble Publishers, to Dell Publishing Co. Following a stint at Auerbach, Pollak & Richardson, in 1976 Noble joined Paine, Webber, Jackson & Curtis, where he spent the next 15 years. Noble, who made a total of 19 team appearances, including ten at No. 1, left PaineWebber in 1990 to form Noble Consultants, a media advisory firm. He died of a heart attack on January 22, 2000, at his home in Rancho Santa Fe, California, at the age of 71.
Retailing David Taylor Coleman & Co. ¥ Ask David Taylor if he would become an analyst today, and he answers without hesitation: “Absolutely, no question about it.” This from a guy who left the analyst game 14 years ago because he was tired of it? “In what other job could a kid from the Bronx travel the country, eat at nice restaurants, stay at nice hotels and meet with the top management at the world’s biggest companies?” asks Taylor. “It’s a fascinating, challenging, exciting job.”
Taylor, now 59, left Coleman & Co. in 1975 after the introduction of negotiated commission rates forced that company “to go the way of the dodo,” he says. Taylor joined E.F. Hutton & Co., where he stayed for two years before moving to Donaldson, Lufkin & Jenrette Securities Corp. In 1982 he left DLJ for Bache Halsey Stuart Shields (which later became Prudential Securities), his last brokerage stop. In all, he appeared 12 times on the II team.
In 1987 Taylor started his own hedge fund, Happauge, New York-based Taylor Capital Management, which he now runs with his son, Jeff.
Savings and Loans Robert Chaut Kidder, Peabody & Co. ¥ Robert Chaut gave his all to savings and loans. As an analyst he wrote some of the earliest research on the industry; as an investment banker he brought S&Ls public and helped fuel demand for their stock; when the sector collapsed in the 1980s, he tried to repair its battered image as a PR man. “You can certainly say that I saw the rise and fall of the S&Ls,” he says.
Chaut, who began with Kidder, Peabody & Co. in 1959, ranked as an All-America S&L analyst there three more times through 1975. That year he joined Blyth Eastman Dillon & Co., covering banks and thrifts until 1979. He moved to A.G. Becker, crossing into corporate finance and working on big thrift demutualizations. In 1984, when Becker was acquired by Merrill Lynch, Pierce, Fenner & Smith, Chaut jumped to Salomon Brothers. After a two-year stint at public relations firm Morgen-Walke Associates, Chaut in 1989 became a managing director at Chase Manhattan Bank, where he worked on a few S&L salvage deals. “The industry had become too big for its britches, but when you’re in it, making a living, you keep hoping that inevitably it will turn around,” says Chaut, 76. Retired since 1992, he lives in Manhattan with his wife, Erna.
Aerospace Alan Benasuli Burnham & Co. ¥ Aerospace whiz Alan Benasuli soared during a long career at Drexel Burnham Lambert and its precursors, making the team every year between 1972 and 1988 and appearing as the top-ranked analyst six times. Benasuli made a splash in 1970 by recommending out-of-favor McDonnell Douglas Corp. He left the then-struggling Drexel in 1989 and within weeks took a job as director of research at Smith Barney, Harris Upham & Co., a position he held until 1993.
Benasuli, 61, ran his own hedge fund for four years; since 1997 he has managed a $400 million large-cap U.S. stock portfolio for New York-based European Investors. From his perch on the buy side, Benasuli sees a profession that has changed immeasurably over the past 30 years. “The difference between now and then is not that analysts don’t work hard - they probably work harder - but the work is not original, and they are totally coopted by their investment bankers.”
Airlines Bert Fingerhut Oppenheimer & Co. ¥ Just 28 when he first appeared on the team, Bert Fingerhut made the team eight years running, through 1979. The next year he became Oppenheimer & Co.'s director of research, a job he kept until the firm was sold to Mercantile House Holdings in 1982, when Fingerhut left the Street for good.
Since then he has lived off his savings and volunteered his services to nonprofits. He sits on the boards of the Southern Utah Wilderness Alliance and the Alaska Conservation Foundation and works pro bono as chairman of the Wilderness Society. Says the New York native, who now lives in Aspen, Colorado, “I’m so far removed from Wall Street that I don’t really follow it anymore.”
Banks Warren Marcus Salomon Brothers ¥ Warren Marcus hasn’t strayed far from banks. As president and CEO of WRM Equity Management, which he founded in 1983, Marcus, 64, manages $170 million for three pension funds, with all of the money in financial services stocks. Between January 1, 1984, and December 31, 2000, WRM returned 19 percent a year for its original client. Year-to-date, the portfolio has gained 60 percent. Marcus’s secret? He sticks to what he knows - small and midsize banks. “There are a lot of small banks that are difficult to buy and sell that are not well researched. That’s how we do well.”
Marcus started his career at Merrill Lynch, Pierce, Fenner & Smith in 1959. Two years later he moved to M.A. Schapiro & Co., the financial institutions specialists. He joined Salomon Brothers in 1964, and by 1966 he was running the bank research department. In 1972 he was made a general partner of the firm, a position he held until he resigned in 1980. Between 1972 and 1979, Marcus made eight appearances - one more in first - on the II team.
Chemicals Edward Giles F. Eberstadt & Co. ¥ F. Eberstadt & Co. is long gone, but Edward Giles harbors fond memories. “We made money every month but one,” says Giles, 66. “And we had four times more in deferred profit-sharing than in capital.” Giles, who appeared a total of 11 times as an All-American - seven times at No. 1 - became research director in the early 1970s and then president of Eberstadt in 1979. When Robert Fleming bought the firm in 1985, Giles became vice chairman. Three years later he took a job as chairman of Vertical Group, a New York-based venture capital firm. Today he runs money for family and friends from a New York office and continues his work with Vertical. Giles liked to look for specialty chemical companies that investors might overlook. As an analyst he recommended National Starch & Chemical Co., and in 1978 the company was bought by Unilever - at a premium. Giles is happy with the pace of his current life. “I wouldn’t care for the sell side too much right now. I guess that’s just age and time.”
Containers H. Edward Schollmeyer Mitchell, Hutchins & Co. ¥ They called him “the can guy,” and no wonder: H. Edward Schollmeyer’s office at Mitchell, Hutchins & Co. was a Dumpster’s dream of empty soda cans, snack tins and glass bottles. One of four founding members of Mitchell Hutchins’s research department, Schollmeyer retired in 1990 after spending his entire 29-year Wall Street career there or at PaineWebber, which acquired the firm in 1977. He appeared on the All-America Research Team 18 times, five times in first. In 1992 Schollmeyer helped Crown Cork & Seal Co. broker a hostile takeover of Van Dorn Co., an Ohio oil- and paint-can manufacturer. It was the first time a hostile takeover had prevailed under that state’s restrictive antitakeover laws. “As an analyst, I followed about 20 companies,” recalls the 76-year-old World War II veteran. “Now they’re consolidated into two.”
Drugs James Balog William D. Witter ¥ After graduating from the School of Chemistry and Physics at Pennsylvania State University, James Balog joined Merck & Co., where he worked for ten years. In 1963 he moved to Auerbach, Pollak & Richardson, where he covered Syntex Corp. and GD Searle & Co., two companies involved in creating an oral contraceptive. Though Balog thought they had enormous commercial potential - “it was the dot-com of the 1960s” - the companies faced serious obstacles. Some states banned distribution of information about contraception, even after the FDA approved the pill in 1960. “We were worried if we could mail our research report in some of the goddamned United States,” recalls Balog, 73.
Balog, cited for his understanding of scientific research, moved to William D. Witter in 1969, where he became head of the health care group. In 1976 Drexel Burnham & Co. merged with William D. Witter, and Balog became a senior vice president. He left in 1987 to work for the Lambert Brussels Capital Corp., which had a 35 to 40 percent stake in Drexel. Balog retired in 1993.
Foods John Maxwell Jr. Oppenheimer & Co. ¥ After spending nearly five decades as an analyst covering food, beverages and tobacco, John Maxwell Jr. finally called it quits in the summer of 1999. From 1972, when he first appeared on the All-America team with Oppenheimer & Co., through 1993, Maxwell made 37 team appearances in three sectors - Foods, Beverages and Tobacco. He finished first four times. He put in stints at Wheat, First Securities, Morgan Stanley & Co., Lehman Brothers Kuehn Loeb, Furman Selz Meger Dietz & Birney and Davenport & Co. Maxwell’s parting shot was a sell rating on Philip Morris Cos. in 1998, as the tobacco industry was nearing its sweeping settlement with the government. “They never should have done that,” says Maxwell, now 74. “The companies were winning those suits. Now, since they settled, there have been 900,000 new suits around the world. I saw the doors opening.”
Insurance Neil Kreisel Oppenheimer & Co. ¥ In the mid-1970s Neil Kreisel felt the ground shift beneath his feet. “Analysts were being asked to get investment banking business and basically become stock pickers,” says Kreisel, who ranked four times as an analyst through 1976. Just 27 at the time, Kreisel wrote a 75-page report in January 1972 that was then considered the insurance industry bible. “I didn’t want to be a stock picker.” In 1977 Kreisel left Wall Street to work for his father’s small New York City real estate company, Kreisel Co., which managed 2,000 apartments. After he took over the firm, he grew apartments under management to 60,000. In 1995 the family sold out to Insignia Financial Group. Kreisel retired in December 1998 and moved with his wife to Santa Barbara, California. Now 56, he recently completed a novel about a New York City boy who grows up without a father. Kreisel hopes to find a publisher for Dinner with Smokey.
Machinery John Mackin Burnham & Co. ¥ He went to the same office for 26 years, and when he left he didn’t look back. “I don’t miss anything about Wall Street,” says John Mackin, the ’72 first-teamer in Machinery from Burnham & Co. Mackin joined Morgan Stanley & Co. a few months after his team debut and retired from the firm in December 1999. Over the years, he made 24 team appearances, ten times in first.
During his tenure on Wall Street, Mackin, 61, saw the quality of research improve, especially as analysts gained increased access to information. He recalls phoning a New York Stock Exchange-listed company in the late 1970s to request an annual report. The company refused to send him a copy because one had already been shipped to the Morgan Stanley library. Mackin also remembers “fighting like hell” for a $10,500 starting salary at Burnham in 1967 - and fighting again, after he was II ranked, to get $100,000 in 1973.
Retired and living in Westfield, New Jersey, Mackin cycles about 60 miles a week and works out regularly at a gym. “I’ve lost 30 to 40 percent of my analytical body fat,” he jokes.
Nonferrous Metals George Cleaver Alliance One Institutional Services ¥ As his son tells the story, when George Cleaver was named to II’s first All-America Research Team as an analyst at Alliance One Institutional Services, he savored the victory as a personal vindication. Hounded by the FBI in the 1950s as a suspected communist - he was briefly a party member as a teen in the late 1930s but gave it up soon after the start of World War II - Cleaver lost several corporate jobs in the 1950s and early 1960s because of his past, his family believes. “Dad suffered a lot,” says son Kevin, the eldest of five. “One day he told my mother he was going to get a job on Wall Street, where they don’t care if you’re a one-eyed cyclops - as long as you make them money.”
A Japanese code-cracker as a World War II army intelligence officer, Cleaver in 1948 landed a job as an economist with the Federal Reserve Bank in Washington, D.C. Then came the McCarthy-era witch-hunts. In the 1960s Cleaver arrived at Walter B. Delafield Co. - renamed Alliance One in 1970 - as a metals analyst. He switched to White, Weld & Co., which was purchased by Merrill Lynch & Co. in 1978. Cleaver made 11 team appearances, four times as No. 1, before retiring in 1984 at age 67. He then taught Russian history at the State University of New York at Stony Brook. He died in 1998.
Oil Charles Maxwell Cyrus J. Lawrence & Sons ¥ Charles Maxwell, Cyrus J. Lawrence & Sons’ top oil and energy analyst for almost three decades, placed 28 times in the rankings in the following categories: Energy, where he took top honors in 1974; Oil/Domestic; and Oil/International, where he was No. 1 seven times. Maxwell retired in 1997, after moving with C.J. Lawrence through two mergers - with Morgan Grenfell & Co. in 1989 and Deutsche Bank in 1990.
He spent the first two years of his retirement doing venture capital work for Les Carden, a biotechnology company. Spotting “storm clouds gathering,” he came out of retirement in 1999 at the behest of his longtime friends, Donald Weeden and Barry Small, at Greenwich, Connecticut-based Weeden & Co., joining the firm as its only energy analyst.
Pollution Control Robert Mayforth Laird ¥ Robert Mayforth never really worked “on” Wall Street. In 1960, after 12 years as a chemical engineer for DuPont in Wilmington, Delaware, Mayforth became the chemicals analyst for research boutique Wilmington Group. In 1966 he moved to the sell side with New York-based Laird, where he became one of the first analysts to focus on the emerging pollution control industry. Mayforth remained in Wilmington, where he raised his family. He stayed put through two acquisitions - G.H. Walker & Co.'s purchase of Laird in 1972 and White, Weld & Co.'s acquisition of the merged firm two years later. In all, he made the AART six times, repeating at No. 1 in 1973.
But in 1978, when Merrill Lynch & Co. bought White Weld, Mayforth joined Butcher, Singer & Co. as a retail broker; he then managed high-net-worth accounts for 18 years at Alex. Brown & Sons. Now 79, Mayforth works on managed accounts for Tucker Anthony. Would he consider returning to research? “No, sir. I want a little fun. It’s a serious business nowadays.”
Railroads Alan Roth Roth Gerard & Co. ¥ “It was an industry nobody wanted,” says Alan Roth of the 1970s railroad industry. When May Day put his firm, the New York-based Roth, Gerard & Co., out of business in 1975, Roth, then 42, took time off. A graduate of Brown University, Roth had worked as an analyst at Lehman Brothers before co-founding the firm in 1962 with his partner, Emanuel Gerard. In the late 1970s he embarked on several house renovations and coached his son’s soccer team. In 1981 he and his family moved to San Diego. “I had the rare pleasure of spending 12 years on the field with my son,” says Roth, who made three team appearances and now resides with his wife, Ingrid, in Rancho Santa Fe, California.
Steel Peter Marcus Mitchell, Hutchins & Co. ¥ Steel stocks were depressed for most of the 1960s and early 1970s, but top-ranked Peter Marcus earned his reputation by predicting the turnaround of U.S. Steel in the early 1970s.
Marcus got his start at L.F. Rothschild & Co. before joining Mitchell, Hutchins & Co. in 1971. He spent 28 years at the firm, which was absorbed by PaineWebber in 1977. In 1999 he started his own research and consulting firm, World Steel Dynamics. The Englewood Cliffs, New Jersey, boutique produces steel industry research for 250 clients, a mix of institutional investors and steel companies. His son Andrew is a Deutsche Bank Alex. Brown broadcasting analyst who made the team for the past four years. Asked about the controversy surrounding today’s Wall Street research, Marcus, now 63, is circumspect. “The clever, quality analysts will find ways to add value.” Marcus certainly did, making 30 team appearances in Steel and Nonferrous Metals between 1972 and 1995. He ranked No. 1 eight times.
Textiles Jay Meltzer Loeb, Rhoades & Co. ¥ Jay Meltzer made his name calling the double-knit bubble of 1971, when textiles manufacturers of those polyester wonder fabrics (so called because they were made with two sets of needles) saw their shares soar and then collapse.
Today Meltzer, 73, wears new duds. Retired two years ago, he spends his time traveling and reading. “I’m stretching my mind,” he says. After 23 consecutive years in II’s rankings - 11 times in first place - he has earned his rest.
“Today an analyst’s equipment is spectacular, and the training is better,” he says. “But the need for ‘instant research’ has changed the analytic thrust for the worse.” After working in the textiles business for 11 years, Meltzer joined Loeb, Rhoades & Co. in 1960 as an analyst and moved to Goldman, Sachs & Co. in 1979. He retired from Goldman in 1994, but only long enough to take a six-month cruise; he joined Johnson Redbook Service (later called LJR Redbook Research), where he oversaw the development of its retail monitoring system.
Utilities Charles Benore Salomon Brothers ¥ Charles Benore, who joined Salomon Brothers as an analyst in 1971, made his name as an advocate for utilities’ yield opportunities as a substitute for bonds. After taking the top spot in Utilities in 1972, he moved to Mitchell, Hutchins & Co. - now UBS PaineWebber - ranking 23 times as an All-America team member, including eight times as No. 1. In 1995 he started a consulting firm, Benore Financial Consulting. Based in Bar Harbor, Maine, Benore advises public utilities on a range of financing and regulatory issues, not least the mess in California, which he views in an encouraging light. “The California energy problems have illuminated a problem,” says Benore, 65. “It shows the importance of getting regulatory restructuring right.”
