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Tuesday, 6 July 2021

Meet our analyst of the week: EFG Hermes’ Yousef Husseini

OUR ANALYST OF THE WEEK- Yousef Husseini, vice president of research at EFG Hermes (Linkedin).

My name is Yousef Husseini and I was actually supposed to be an engineer. I studied engineering at UCLA, but after a few internships, I decided that the field isn’t for me. I was already taking accounting and finance courses as electives so I decided to transition into the financial world by taking an investment banking course in the US. Our teacher was really into sell-side research. He always argued that it was the best place to start a career because you get exposure to a lot of sectors and you work with many departments. His words must have sunk in because I soon landed my first role as a sell-side analyst at EFG Hermes.

I’ve been at EFG for almost 12 years now. I was initially supposed to work in Saudi Arabia, but after spending some time training in Egypt, my then manager asked me to stay. It turned out to be the best thing that has ever happened to me seeing as I feel very much Egyptian — I’m originally Palestinian — and I think my Egyptian accent is getting better [laughs]. More importantly, there’s the added bonus that I married my wife Nada here.

I now cover the petrochemicals sector, mostly in Saudi Arabia, but I do cover a few firms in Egypt.

For anyone starting out as an analyst, I definitely would recommend the sell-side. It’s a good building block to have a foundation in all things finance and while it can be hectic and stressful, it’s also very rewarding. You get to talk to a lot of people and gain interesting insights, keeping you on your feet and always growing.

The best part of the job is how diverse it is. As a sell-side analyst there are so many aspects to what you do every day. Research is obviously a very important part of the job, but it's just one part of it. There’s also marketing and talking to clients, because no matter how good your calls are, if you aren't communicating them to clients in a proper way, they're irrelevant. You also have the asset management aspect from looking at investments.

The culture at EFG is to grow vertically. My boss, the head of research Ahmed Shams El Din, has always told me that his goal is to make me good enough at what we do that I could one day take his job. He’s instilled that culture in the team and I’m trying to be that way with my juniors. My goal is to elevate them to a place where they can be the head of the sector. Shams El Din has also been very understanding and flexible with me and my wife in regards to the work from home issue seeing as we’ve welcomed a new baby to the family.

The worst part of my job is the stress. If companies you cover make a big announcement, all hell breaks loose. Your clients start calling and you’re under pressure to come up with a picture of what’s happening and deliver it urgently.

I manage stress by taking a step back from it all. Sometimes you're so caught up in that you don't really realize what's happening. You're just functioning. Taking a step back lets you ask yourself ‘What's the worst case scenario here?’ and realize that if you get something wrong, the world doesn’t end. If I’m working on something that’s not super urgent, I take a nap to get away from it all. I know it's a weird custom, but it really works for me [laughs].

Going forward, I think a mix between physical and virtual roadshows is ideal. Both have their pros and cons, but we’ve learned a lot about virtual roadshows this past year and the benefits have really put themselves forward. There’s a lot less logistics involved and you can get things done quicker and talk to more people, but you lose that intimacy of just getting to sit with your clients face-to-face. That’s why I think it shouldn’t be heavily skewed in one direction.

Personally, I’m sort of a long-haul investor. I look for strong management teams and thematic stories that promise a potential upside. I also focus on dividends a lot, but I’m more interested in growth. As a sell-side analyst, I always try to look at the investment from my client's perspective whether they’re short or long-term investors. So in my job, I would never say an investment tool is bad, I just weigh them differently and try to get a full picture.

A good management team is aware of downside risk. They have analysed all possible scenarios and and try to position the company in a way where if the worst case occurs, they can come out the other side. Other than that, strong management is always trying to identify potential growth outlets and launching new products at the right time.

I would expect that stocks in my sector will perform very well over the next 12 months. Valuation and cashflow wise, the companies I cover in Egypt are in a strong position and I don’t think that’s reflected in the stock price.

The last great thing I watched was Sweet Tooth. I’m big into fantasy and sci-fi and the show is a strange apocalyptic kind of story. However, my favorite running show is Better Call Saul.

I’m currently reading Noise: A Flaw in Human Judgement after I got the recommendation from Enterprise PM. I thought it would be very interesting to reassess myself by taking a step back and thinking about my internal processes.

When I’m not on the job, I’m a full time dad. I spend a lot of time with my kids, especially since my daughter was born 10 months ago. When things calm down at night, I like to play puzzle games whether they’re on my phone or just a rubix cube.


MARKET NEWS-

Integrated Diagnostics Holding (IDH) has announced coupon payments of USD 0.0485 per share for FY2020 returns, the company said in an EGX statement (pdf). Payouts are due out Thursday, 29 July.

MARKET ROUNDUP-

The EGX30 fell 1.9% at today’s close on turnover of EGP 1.11 bn (10.1% below the 90-day average). Regional investors were the only net buyers. The index is down 6.4% YTD.

In the red: Ezz Steel (-5.0%), Pioneers Holding (-4.5%) and Heliopolis Housing (-4.0%).

No EGP-denominated stocks were in the green today. USD-denominated Egyptian Kuwaiti Holding rose 0.1%.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2021 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of Commercial International Bank (tax ID: 204-891-949), the largest private-sector bank in Egypt; EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; and Act Financial (tax ID: 493-924-612), the leading activist investor in Egypt; and Abu Auf (tax ID: 584-628-846), the leading health foodmaker in Egypt and the region.