Eaton Vance Named Best Stock of Last 25 Years

In news that surprised even the most astute investment business insiders, the Boston-based mutual fund company Eaton Vance has been crowned the No. 1 publicly traded stock in the last 25 years.

According to FactSet Research Systems of Norwalk, Conn., Eaton Vance's annualized return of 32% since 1979 put the company ahead of such Wall Street princes as Warren Buffett's Berkshire Hathaway and Wal-Mart Stores.

Eaton Vance leadership learned of the milestone during a slide presentation by M&T Bank, which finished 11^th, at a Merrill Lynch conference late last year.

"There were big smiles on our faces when we saw that," Eaton Vance Chairman James Hawkes told the Dow Jones News Service. "It was one of those, 'Holy Batman' moments."

Investors who purchased $10,000 worth of Eaton Vance stock on Dec. 31, 1979--assuming they reinvested all dividends--saw it grow to $10.6 million 25 years later, the Dow Jones report indicated. Meanwhile, a $10,000 investment in the company's flagship fund, Eaton Vance Tax-Managed Growth, made at year-end 1979, assuming all distributions were reinvested, would have been worth about $209,000 as of Dec. 31, 2004. The fund returned 9.7% in 2004.

Hawkes, who joined Eaton Vance in 1970, attributed the money manager's success to "skill sets that will allow us to make progress in environments where equities are in favor, or out of favor, where bond funds are in favor, or out of favor. If you look at many of our competitors, they do well in certain environments, and then they slow down and don't make progress in other environments."

Eaton Vance, which managed $94.3 billion in assets at the end of 2004 versus about $15 billion 10 years ago, has also managed to sidestep the market-timing and late-trading scandals that have tainted many of its competitors. This distinction that has allowed it to focus on meeting the goals of the company and its clients, Hawkes noted.