Thomas Gallagher
Credit Suisse
First-place appearances: 0

Total appearances: 6

Team debut: 2006

Advancing from runner-up to second place, Thomas Gallagher of Credit Suisse wins plaudits from one enthusiastic buy-sider for “doing a lot of heavy analytical work that other analysts won’t tackle.” For his part, Gallagher asserts that interest rates are “probably the single biggest variable” framing his view of the sector. “Interest rates continuing to grind higher and equity markets that are flat to maybe modestly higher should drive outperformance,” he explains, “mainly because the stocks are still cheap versus other financials.’ He’s also monitoring the differences between the industry’s large-cap and midcap names in terms of capital adequacy and management, preferring the former. In particular, Gallagher cites New York–based MetLife and Columbus, Georgia’s Aflac because these insurers are positioning themselves to retain capital beginning next year and extending into 2015, as required by new federal regulations that bolster capital standards. Conversely, midcap life insurers have not prepared to meet such statutory levels even as they have more aggressively managed their capital, aided in part by techniques that are likely to come under scrutiny if, as the researcher forecasts, these firms become subject to similar rules down the line. Accordingly, he recommends that clients underweight Unum Group, which is headquartered in Chattanooga, Tennessee; and Radnor, Pennsylvania–based Lincoln National Corp. — Carolyn Koo