Brendan Wood International
TopGunSM Press

TopGun Research, Sales & Trading Of Canadian Stocks Facing Headwinds Of North Americanization, Globalization Close Behind

May 27th, 2021 by TopGun Press

 TopGun Research, Sales & Trading Of Canadian Stocks Facing Headwinds Of North Americanization, Globalization Close Behind

– Large Canadian Issuers Expand Their Shareholder Bases In The US & Overseas

– Over 50% Of Institutional Trading In Canada’s Big Cap Stocks Is Generated By US and Foreign Investors. Mid Caps Are Next.

– Canadian Investors Buy More International Stocks

– Global Sector Investing Is Moving Canada’s Traditional Investment Industry Into A North American And Increasingly Global Competition

– Global Sector Investors & Issuer Corporations Demand Borderless Research & Brokerage Services

For Immediate Release – New York, NY, May 28th, 2021 (TopGun Press)

Global sector investing has become the prevalent world practice. Hedge funds aside, big ticket global investors predominantly rely upon global sector research and allocate assets accordingly. Often citing the merits of the multi-national market footprints of the companies they favor, investors search out the best targets in a global industry consistent with their investment style. The global sector investment analysis theme presents challenges for the domestic Canadian broker dealer community. For example, in 2020/2021, almost half the commissions paid for dealer coverage are being paid by US investors buying Canada stocks. Add European and Asia investors trading in Canada stocks and the foreign component becomes the majority. Dealers whose research is ‘Canada centric’ face a declining opportunity.

Canadian corporate issuers are prioritizing the task of marketing to US and foreign investors. Why? According to Brendan Wood’s daily shareholder confidence polling, large Canadian issuers, especially over-achievers in their sectors of industry, are under-marketed outside Canada. US and foreign investors often report a lack of sufficient investment knowledge about Canadian targets and missing dialogue with Canadian senior managements. US banks and broker dealers are picking up coverage on large cap Canadian names as well as mid-caps. According to Brendan Wood intelligence, this trend will continue, driven by Canadian issuer demands for US and foreign research coverage. 

The footholds of Canadian banks and dealers in foreign investor relationships, especially the US, are becoming a defining feature of their future competitiveness even amongst their Canada based issuer clients.

Source of Brendan Wood International Intel: 

Brendan Wood International conducts about 2000 institutional investor debriefs throughout the year. The global investor panel accounts for +$50 trillion in equity investment capital. These in depth debriefs focus on the investment attractiveness of 1400 big cap stocks and the performance of bank/dealer teams in terms of adding value to investment analysis. This process allows BWI to match the value add of analysts, sales and trading professionals with commissions allocated on a stock by stock and sector basis.

This new ‘stock by stock’ market share data quantifies the revenue available to banks/dealers based upon the stocks they choose to cover. In the global sector environment these choices are critical to the ‘revenue per professional’ ratio of a coverage team. 

The trading influence is hardest to quantify, especially in Canada where we found quality of trading services was sometimes outweighed by apparent volume. Institutions are aware of the impact of some larger platforms which somewhat paint the tape. We found two such cases and have corrected the formula. Also Canadian dealer trading services are more general than sector specific. This has been resolved by focusing on institutional blocks as opposed to total volume and weighting quality of trading and individual traders more heavily.* In the US, the prevalence of specialized sector trading makes BWI’s performance analysis of stock by stock and sector trading more accurate. The growth of electronic trading, now over 30% in Canada, continues to commoditize domestic trading services. Observance of MiFID protocols is also shaping the selection of trading desks for institutional trades. Trading which accounts for approximately 35% of commissions on average is a moving target. We therefore spend much more time debriefing buy-side traders to identify sell-side trading performance.

Investment Banking Overlap:

The Research, Sales and Trading franchises of banks are amongst the top criteria corporations use when awarding lead bank mandates and syndicate fees. While respecting the independence of sell-side research, it is nonetheless highly material to an issuer to know how influential an analyst is in the decision to own the company stock and the effectiveness of each dealer’s institutional sales capability. Corporations allocate banking fees accordingly. International distribution capability is a critical selection issue in selecting banks. BWI data identifying the influence of the broker dealers on investors’ decisions to own their stock is in high demand amongst corporations. 

“BWI’s role is to create intelligence which opens up strategic opportunities and solves problems. Our intel is the product of intense debriefing quantifying intangibles at the highest levels of detail and factuality. Often mis-perceived as a survey, the intelligence BWI generates is primarily an independent strategy tool, best used for that purpose. In close domestic competition blocking and tackling is an inevitable and consuming daily focus of the professionals on the execution front. Sell-side professionals are always keen to know what their clients think of them. TopGun Club recognition and boasting rights are widely communicated. However, the underlying purpose of BWI’s intense investigations is to inform strategy and the allocation of our clients’ resources,” said Brendan Wood.

*In Canada BWI encountered a couple of platforms whose trading volume far outweighed actual institutional share, causing correction to methodology accordingly.

Below Are The 2020 TopGun Canadian Sell-Side Analysts, Sales Professionals and Traders

TopGun Sell-Side Research Analysts:

Agriculture, Chemicals, Fertilizers:
Jacob Bout (CIBC)
Ben Isaacson (Scotia)
Joel Jackson (BMO)

Alternative Energy:
Rupert Merer (NBF)
Ben Pham (BMO)
Nelson Ng (RBC)

Banks:
Mario Mendonca (TD)
Darko Mihelic (RBC)
Sohrab Movahedi (BMO)

Base Metals & Minerals:
Greg Barnes (TD)
Orest Wowkodaw (Scotia)
Jackie Przybylowski (BMO)

Biotechnology & Pharmaceuticals, Healthcare / Cannabis:
Justin Keywood (Stifel)
Doug Miehm (RBC)
Tamy Chen (BMO)

Consumer Products & Merchandising:
Mark Petrie (CIBC)
Christopher Li (DES)
Michael Van Aelst (TD)

Diversified Financials:
Geoff Kwan (RBC)
Paul Holden (CIBC)
Phil Hardie (Scotia)

High Tech:
Richard Tse (NBF)
Thanos Moschopoulos (BMO)
Paul Steep (Scotia)

Industrial Products:
Maxim Sytchev (NBF)
Walter Spracklin (RBC)
Kevin Chiang (CIBC)

Insurance:
Mario Mendonca (TD)
Tom MacKinnon (BMO)
Darko Mihelic (RBC)

Media:
Drew McReynolds (RBC)
Jeff Fan (Scotia)
Adam Shine (NBF)

Oil & Gas Equipment & Services:
Jeff Fetterly (Peters)
Greg Colman (NBF)
Ian Gillies (Stifel)

Oil & Gas – Large Cap:
Tyler Reardon (Peters)
Justin Bouchard (DES)
Greg Pardy (RBC)

Oil & Gas – Small/Mid Cap:
Ray Kwan (BMO)
Dan Grager (Peters)
Patrick Bryden (Scotia)

Precious Metals & Diamonds – Large Cap:
Tanya Jakusconek (Scotia)
Josh Wolfson (RBC)
Greg Barnes (TD)

Precious Metals & Diamonds – Small/Mid Cap:
Ovais Habib (Scotia)
Trevor Turnbull (Scotia)
Tyron Breytenbach (Stifel)

Pulp, Paper & Forest Products:
Daryl Swetlishoff (RJ)
Hamir Patel (CIBC)
Sean Steuart (TD)

Real Estate, REITS & Hospitalities:
Neil Downey (RBC)
Mario Saric (Scotia)
Michael Markidis (DES)

Telecommunications & Wireless:
Jeff Fan (Scotia)
Drew McReynolds (RBC)
Vince Valentini (TD)

Transportation:
Walter Spracklin (RBC)
Fadi Chamoun (BMO)
Kevin Chiang (CIBC)

Utilities:
Robert Kwan (RBC)
Robert Hope (Scotia)
Ben Pham (BMO)

Economics:
Avery Shenfeld (CIBC)
Stefane Marion (NBF)
David Doyle (MAC)

Index Analysis:
Peter Haynes (TD)
Andrew Moffatt (Scotia)

Portfolio Strategy:
Ian de Verteuil (CIBC)
Martin Roberge (CG)
Hugo Ste-Marie (Scotia)

Quantitative Analysis:
Mark Deriet (COR)
Christopher Dutton (TD)
Martin Roberge (CG)

SmCap/SpSits:
Maggie MacDougall (Stifel)
Stephen MacLeod (BMO)
Dimitry Khmelnitsky (VIR)

Technical Analysis:
Mark Deriet (COR)
Javed Mirza (CG)
Tina Normann (Eight)

TopGun Sell-Side Sales Professionals Selling Canadian Equities:
Bernie Allion (RBC)
David Beevor (RBC)
Mike Bryden (BMO)
Justin Burrage (DES)
Guillaume Caya (TD)
Jean-Philippe Cousineau (NBF)
Gonzalo Escoto (Scotia)
Mark Ferguson (TD)
Jhad Friesen (CIBC)
Brian Jones (RBC)
Bannon Kopko (Scotia)
Todd Krauser (RBC)
Rick Lavoie (NBF)
Kyle MacGregor (BMO)
Ryan Males (CIBC)
Brad Marcotte (Peters)
Grant Moenting (Scotia)
Wendy Nichols (NBF)
Nathan Normandin (BMO)
Robert Posthumus (CIBC)
Ali Qureshi (CIBC)
Bonita To (Scotia)
Arash Yazdani (DES)

TopGun Sell-Side Traders trading Canadian Equities:
Ashlim Ameen (RBC)
Jay Bakker (COR)
Steven Barnes (RBC)
Kevin Costa (Eight)
Chris Finora (TD)
Carlo Giarrusso (BMO)
Ara Guiragossian (CIBC)
David Lower (NBF)
James McGrogan (CIBC)
Andrea Morwick (BAML)
Loutfi Mouaket (CIBC)
Peter Newell (Scotia)
Brian O’Hea (NBF)
Derek Oram (RJ)
Rip Patel (BMO)
Devin Ramasawmy (BMO)
Tom Scheuring (RBC)
Chris Stuart (CIBC)
Godefroy Tessier (BMO)

 

About Brendan Wood International:

Brendan Wood International (BWI), formed in 1970, is a private partnership generating independent performance audits throughout the world. Relying on real time intelligence, the firm advises public companies, institutional and activist investors, investment banks and broker dealers on strategy, performance and recruitment of TopGun talent. The firm’s partners have formally presented at 1000+ C level strategy meetings and corporate off sites in fifty cities. Brendan Wood founded the exclusive TopGun Club.
Related Links:

www.TopGunPress.com
www.brendanwood.com
@BrendanWoodIntl
Contacts:

Jordan Novak
Partner
Brendan Wood International
+1 416 924 8110
jnovak@brendanwood.com
Amanda Knott
Managing Director
Brendan Wood International
+1 416 924 8110
aknott@brendanwood.com

 

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