< The 2014 All-Europe Research Team

Gareth Evans & team
Deutsche Bank
First-place appearances: 1

Total appearances: 14

Team debut: 1999

Repeating in second place is Deutsche Bank, directed solely by Gareth Evans since the departure last summer of former co-leader Michael Biggs for U.K. buy-side firm GAM International Management. The five-member team, based in Frankfurt and London, earns praise for its “combination of a local and a global approach,” as one backer puts it. A stabilized environment for lending has convinced the strategists that the euro zone’s turnaround is sustainable. Moreover, says Evans, “an improvement in credit conditions still lies ahead, which can give rise to another leg in the recovery.” In addition, earnings could beat expectations, since they are 30 percent below trend and “operational leverage is higher after the cost-cutting that has been done,” he notes. Accordingly, the researchers forecast that the Stoxx Europe 600 Index will close this year at 375 — for a year-over-year gain of 14.2 percent — and they prefer the Euro Stoxx Index over the Swiss and U.K. markets because “the euro area economy still has the greatest capacity to positively surprise,” Evans explains. Given this positive economic outlook, his squad is advising investors to stick with cyclicals and financials and to focus on value, short-duration and high-dividend-yield investment styles.