Investment banks turn on Barrenjoey-owner Magellan

Days earlier, Jarden also downgraded Magellan to “underweight”. Jarden’s research was published on the very same day Magellan announced that Barrenjoey will underwrite its dividend reinvestment plan, keeping its investment banking needs firmly in-house.

Jarden is another new investment banking entrant, whose CEO Robbie Vanderzeil is one of the few long-time lieutenants that Grounds and Fowler didn’t take to Barrenjoey. Instead, Vanderzeil quit as UBS’s head of equity capital markets last year and took UBS’ deputy head of research Ben Gilbert with him to Jarden. Different view from the equities desk, same view of Magellan.

Morgan Stanley has been underweight Magellan since August, and on Monday released its latest quant strategy note placing the fund manager firmly in its “least preferred” stock ideas. And Bell Potter’s Richard Coppleson says he’s been bearish on Magellan for months, for similar reasons to UBS.

Credit Suisse, Macquarie and JPMorgan remain neutral, all with 12-month price targets way above Magellan’s current $38.98. Wonder how long that’ll last.