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The 2014 All-America Research Team: IT Hardware, No. 2: Kathryn Huberty

    <The 2014 All-America Research Team Kathryn HubertyMorgan StanleyFirst-place appearances: 0

    Total appearances: 5

    Team debut: 2010

    Repeating in the No. 2 spot on this list isKathryn Hubertyof Morgan Stanley, who earns investor praise for doing “the best work in terms of sizing the market and identifying product opportunities,” as one fund manager puts it. Huberty reports on 19 information technology hardware shares and is cautious on the sector overall, believing that accelerating cloud adoption will continue to shrink revenues and margins for companies selling into traditional enterprise data centers. “Our favorite stocks are those with less disruption from cloud computing,” she adds, “which also happen to be cheaper on an [enterprise value to free cash flow] basis.” Examples include Cupertino, California’s Apple; Palo Alto, California–based Hewlett-Packard Co; Ireland’s Seagate Technology; and Western Digital Corp. of Irvine, California. “Over the next year, we believe, the Internet of Things will be the most impactful new trend in technology, wherein devices of all types will be connected to the Internet,” advises Huberty. “Within IT hardware we believe Apple is best positioned to monetize the trend with iWatch, HealthKit and HomeKit catalyzing adoption in the same way that iPhone drove mobile Internet adoption.” Apple’s stock closed at $101.63 in mid-September, an the analyst forecasts a rise to $110. She “has thorough, thoughtful models,” observes another buy-side backer.