Fundamental Research

After not only surviving but thriving during a 20-year transformation of the execution landscape characterized by rapid regulatory changes and competitive responses, commoditization and shrinking brokerage lists, we think we understand the challenges—and opportunities—in such an environment. The headwinds from MiFID II are reverberating globally and shrinking research budgets are real, but so is the opportunity we believe. Unsurprisingly, the formula for success in fundamental research isn’t too different than it was for execution: 1) develop deep domain expertise; 2) offer a differentiated product and make sure we are responsive to clients; and 3) embrace independence and avoid conflicts of interest. What does that mean in practice? It means a laser focus on Technology (including FinTech), Media and Telecom by analysts who understand their industries deeply, typically by having started their careers in them and seeing them from the inside out—and, importantly, who collaborate to ensure the most informed opinions. It means offering unique corporate access opportunities, including our client trips to mainland China and our Silicon Valley bus tours. And it means delivering insights, not maintenance research, about both disruptive/thematic industry changes and incremental data points through bottom up channel and field work including on the ground in China, in all cases driven by client need, not investment banking demands.

The result of this approach is while others are contracting their efforts if not shuttering them altogether, we are expanding. We are adding experienced analysts and smart, energetic associates, not cutting staff. We are rolling out coverage on more names, not less. We are planning lots of corporate access. We are committed to the business and becoming the premier TMT research boutique.

Click here for our Equity Research Coverage Universe and Valuation Comp Tables (pdf)