This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

M&A Boutiques Benefit From Big Bank Woes

This sales pitch is probably helped by the fact that the reputations of big banks have taken a beating. Even banks perceived as successful, like Goldman, have been widely criticized and seen defections among top dealmakers. Byron Trott, best known as the favorite investment banker of Berkshire Hathaway (BRK-A) Chairman Warren Buffett, left Goldman to strike out on his own in March, and Lazard hired Tom Tuft, a top equity capital markets adviser at Goldman, in August.

The boutiques largely deserve the PR victory they're scored, says William Cohan, a former investment banker who has written books about Lazard and Bear Stearns and is at work on a book about Goldman.

"If more firms were run like Lazard, we might have saved ourselves $12.2 trillion dollars here," he says.

Cohan says the Lazard philosophy, best embodied by former Chairman Michel David-Weil but largely carried on by current boss Bruce Wasserstein, means avoiding dangerous financial fads like mortgage-backed securities, bridge loans, internet IPOs, emerging telecom debt and the like.

"They treat the firm as if their shareholders' and creditors' capital was their own," Cohan says.

That relative lack of risk taking kept the boutiques' shares from getting pummeled as severely as the stocks of the big banks late last year and early in 2009. Though they did sell off, they have rebounded sharply since March, along with the broad rally in the U.S. equities market.

"Part of the reason you'll see all of these stocks doing better recently is people are starting to see what they think is the beginning of an upturn in M&A," says Scott Bok, Co-CEO of Greenhill.
3 of 4

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
BAC $17.88 -1.38%
C $58.46 -0.71%
EVC $7.67 3.79%
GS $205.07 -1.03%
GHL $39.33 -0.20%

Markets

Chart of I:DJI
DOW 17,689.86 -56.12 -0.32%
S&P 500 2,103.84 -4.79 -0.23%
NASDAQ 5,128.2810 -0.5040 -0.01%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs