A tumultuous 2022 election cycle and a lagging market left investors with more questions than ever about Brazil.
“From Brazil’s October 2022 elections, through to early April this year, the main question we received from investors was: “What is the government’s plan?” said Andre Carvalho, director of research at Bradesco BBI. “Indeed, there appeared to be a clear lack of clarity about where Brazil was heading.”
Additionally, the MSCI Brazil has been trading at depressed multiples since the middle 2022, pricing in a high risk of macro disarray after the presidential and congressional elections of last year. Brazilian equity multiples were depressed across the board, with more than 85 percent of the MSCI Brazil regularly trading at attractive valuations.
“The year started quite volatile, with investors trying to understand the new government's main policies and goals,” said Carlos Sequeira, head of research at BTG Pactual. “After a few months and increased clarity on the government’s fiscal policies, focus shifted to a broad, complex, and challenging tax reform that the government and Congress hope to get approved still this year.”
Fortunately, investors had an elite group of sell-side firms to turn to for answers. These firms were recognized in Institutional Investor’s 20th annual All-Brazil Research Team, based on the opinions of nearly 650 individuals across 371 firms with significant Latin America holdings.
In a competitive domestic field, BTG Pactual broke a two-year tie with Bradesco BBI to claim the sole No. 1 spot this year. Bradesco BBI placed second by the narrowest of margins, with only one team position separating the two firms. BTG Pactual maintained its 19 positions from last year, while Bradesco BBI garnered 18.
To select the members of the 20th annual Brazil Research Team, Institutional Investor solicited opinions of directors of research and investment professionals at asset management firms with significant securities holdings in Latin America. We received responses from 646 individuals at 371 firms. The names of individuals surveyed are kept confidential to ensure their continuing cooperation.
This year, participants rated their top firms in each sector and then separately rated individual analysts or economists/strategists at those firms to create two distinct rankings for each sector. A numerical score was produced by weighting each vote based on the respondent’s Brazilian commission range and the average rating awarded. The same scores were also weighted by each voting firm’s Brazilian equity assets under management to produce the AUM-weighted rankings.
Using those scores, ranks were determined. Firms/analysts were designated runners‐up when their scores came within 35 percent of the third-place scores. For the analyst rankings, individuals, who switched firms after February 16, 2023, are cited at their previous organizations.
Voters must meet eligibility requirements, and winners must achieve a minimum vote count. All ballots are subject to review by our Research Operations Group.
The 2023 Brazil Research Team was compiled by Senior Project Managers Tucker Ewing, and Associate Project Manager Katie MacDougall.