The 2016 All-Europe Research Team: Italy, No. 3: Flavio Cereda & team
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The 2016 All-Europe Research Team: Italy, No. 3: Flavio Cereda & team


Bank of America Merrill Lynch returns to claim third-place honors

< The 2016 All-Europe Research Team


Flavio Cereda & team

Bank of America Merrill Lynch

First-place appearances: 0

Total appearances: 2

Team debut: 2014

Bank of America Merrill Lynch debuted on this roster two years ago, in second place, then fell from the ranking. It returns to claim third-place honors, with coverage now under the sole direction of Flavio Cereda, who also guides a group to runner-up on the Small- & Midcapitalization Stocks lineup this year. His former co-head in this space, Raffaella Tenconi, left in March to found her own consulting firm, ADA Economics. Nineteen of the firm’s analysts in London provide research on 38 Italian companies, “on the basis of their specialist expertise,” says Cereda, 54. Their reporting on the nation’s banks is singled out for praise. In a sector that “can be quite opaque,” one fund manager says, “their recommendations have been excellent — particularly the long-held buy on Intesa Sanpaolo, which has been very successful for the last two years.” Among Italy’s largest lenders by both market capitalization (€45.4 billion [$50.9 billion]) and assets (€668.4 billion), the Turin-based institution remains a BofA Merrill favorite for the year ahead. Positive factors informing their view include Intesa’s better than competitive capital position, compared with domestic and regional peers; low level of debt combined with reliable revenue streams; and strong per-share profitability expansion, setting it apart from many other dividend stocks. In mid-January the shares were trading at €2.80, up 16.2 percent over the trailing 12 months. During the same period, the Italian market inched up 1 percent, while domestic banks were nearly flat, and the European market overall tumbled 13.6 percent. Cereda’s crew projects that Intesa will climb to €4.30.

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