The 2016 All-Europe Research Team: Technology/Software, No. 2: Michael Briest & team

Michael Briest & team

UBS

First-place appearances: 5

Total appearances: 16

Team debut: 2000

For a second straight year,Michael Briestpilots UBS’s European software team to No. 2. He and one colleague work out of London, while a third teammate is stationed in India. Together the three researchers track 21 names in this sector. They shifted position on France’s Capgemini in April, on news that the information technology services provider would acquire U.S. competitor iGate Corp. for $4 billion. The catalyst was spent, they believed, and lowered their rating from buy to neutral. By mid-January Capgemini’s shares had slipped 5.6 percent, to €78.65, against the sector’s loss of 3.6 percent. Briest, 43, and his associates moved in the other direction on German enterprise software developer SAP. Advising in July that improving license sales could drive a rerating, they raised their stance on SAP from neutral to buy. Its shares subsequently rose 14.8 percent, to close at €70.68 in mid-January. During the same period, Europe’s software and IT services companies overall climbed 7.2 percent. In the sector generally, "valuations are high relative to history in both software and IT services, but against the European market, valuations are less alarming," Briest counsels. "Growth is in scarce supply across the market, so stocks that can deliver it consistently will continue to be rewarded. The software names continue to be volatile around how they execute on the transition to the cloud, but software probably offers the best opportunities to make profits in 2016 — unless there is a big pickup in economic activity levels."