Friday, April 10th, 2009
By Jessica Wohl
CHICAGO, April 9 (Reuters) - Veteran consumer products analysts are rejoining the fray just in time for earnings season, yet this time, they will be working for themselves.
Bill Pecoriello, who was most recently at Morgan Stanley (MS.N), said his firm, Consumer Edge Research LLC, will officially launch next week.
While Consumer Edge is the first boutique start-up focused on the consumer products sector, the idea of leaving the bank behind is not new.
Notable recent additions to the industry include banking analyst Meredith Whitney leaving Oppenheimer earlier this year to start Meredith Whitney Advisory Group LLC. Just last week, two alternative research executives recently left JPMorgan (JPM.N) to set up their own company, Primary Insight
Banks such as JPMorgan have been trimming research to cut costs as the global recession deepens.
“You’re seeing that boutiques are springing up in all parts of the investment business,” Pecoriello said on Thursday. “We’re basically filling the void left behind as Wall Street cuts back on its resources.”
Pecoriello, who left Morgan Stanley earlier this year, will take the lead covering beverage and household products makers such as Coca-Cola Co (KO.N) and Procter & Gamble Co (PG.N). Former Merrill Lynch food analyst Eric Serotta will cover names such as Kraft Foods Inc (KFT.N).
With four other researchers on staff, the Stamford, Connecticut-based firm has more than 80 years of experience in consulting and investing, Pecoriello said.
He said Consumer Edge would differentiate itself by doing surveys and checking in with individual stores and distributors for the latest data. The reports it sends to clients will be encrypted so that they cannot be distributed to those who do not pay for them.
Pecoriello expects his clients to be a “select group” of institutions, such as mutual funds, hedge funds and pension funds.
Consumer Edge will cover U.S. companies for now, and expects to take on coverage of international companies “down the road,” Pecoriello said.
The firm will not own shares in the companies it covers.
