Despite advancements in recent decades, women in equity research are still largely outnumbered by men. Nonetheless, many are statistically equal to, if not more accurate than, their male counterparts at evaluating stocks. In this regard, the financial world still has a long way to go in including women into its ranks.
Mind the Gap
Yes, women are a minority in financial-linked roles, but the issue is deeper than we think. The trend has shown that at the junior level, the number of men and women in the financial sector are almost equal. However, when it comes to the top positions in the workforce, men outnumber women by a significant margin. For instance, in the sub-sector of Private Equity, not even 10% of overall senior positions are held by women.
Moreover, according to a study by Deloitte, women in leadership roles in the financial sector constituted only 24% in 2021. This proportion is expected to grow to 28% in 2030, which is still below parity. This highlights the fact that there is a disproportionate climb up the ladder for finance professionals, begging us to question, why? The answer has many facets.
One such facet is the perception of men as analysts being superior to women. This perception holds for men and women investors alike. As the world gets more digitally connected, it is important to keep making noise about power of women in Finance and attract more women to the top to break the stereotype and fix the mix.
Appreciating the Leading Ladies of Wall Street
This women’s day gave us the perfect opportunity to celebrate the contributions of women in the field of equity research. We had already identified the top 10 leading women analysts of Wall Street ranked on TipRanks, and how the average success rate of these analysts is a significant 62.85%.
For the unversed, TipRanks currently follows and ranks 7,777 analysts from the U.S., UK, and Canada, and the average 1-year return for the favorite stocks of these analysts is about 5.7%. Now, if we filter out the top 50 women analysts and measure the average return for their stock picks, we see that the percentage spikes to 19.51%. Further focusing in on the top 10 women analysts, the average return of their top rated stocks is an impressive 33.46%.
The more we sift through and pick out our best analysts, the better the average return per stock recommendation gets. Today, in honor of International Women’s day, we narrowed down our search to the top female analyst in the U.S., Helane Becker.
The managing director and senior research analyst at Cowen & Co. brings more than 40 years of rich experience on Wall Street, and is ranked 80 out of the thousands of analysts tracked by TipRanks. She specializes in airlines, air freight, and aircraft leasing. Notably, 282 out of her 415 rated stocks, or 68% of her ratings, have hit the bull’s eye.
These rough times across capital markets call for investment advice from an expert. Here we discuss a top stock recommended by Becker with a potential for high upside this year.
Becker’s Bet
The five-starred analyst’s focus has been fixed on United Airlines, Inc. (NASDAQ: UAL) as a top pick for 2022. In a recent interview with CNBC, she reiterated her belief that international travel will witness a resurgence in the coming months, and United Airlines stands to benefit handsomely from it. Continued domestic demand and the resurgence of leisure travel are also expected to benefit the airline. To meet the expected surge, the company is focused on increasing its international destinations this year.
Becker sees a strong rebound in travel by this summer, due to the last two to three years of pent-up demand. In October last year, she maintained a Buy rating on UAL, and raised her price target to $78 from $72. She has confidently maintained her stance ever since.
As if in-line with her predictions, United Airlines’ operating revenues for 4QFY22 rose a whopping 140% year-over-year. This growth was driven driven by a 185% year-over-year increase in passenger revenues. Moreover, the firm also managed to narrow its loss per share to $1.60 from $7, recorded in the prior-year quarter.
However, Wall Street analysts remain cautious about the airlines’ prospects, with a Hold rating based on five Buys, five Holds, and three Sells. The average UAL price target is $54.46, indicating an upside of 74.38% over the next 12 months, as of intraday Tuesday trading at 9.53 a.m. EST.
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