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MVPs of MVA

Which companies created the most wealth for shareholders last year? Enter MVA -- or market value added.
Stephen Taub, CFO Magazine
July 1, 2003

Like the wicked queen in the tale of Snow White, analysts are forever trying to identify the fairest of them all — the strongest, most innovative, and fastest-growing companies. Finance executives, in turn, are constantly seeking a metric that communicates a company's financial condition in a way that enables employees to make rational decisions about operations. There is no shortage of metrics, but as the past two years have witnessed, many of them, in particular EBITDA and pro forma, have been vulnerable to distortion.

Enter MVA, or market value added, which measures the amount of wealth a company has created since its inception. MVA is an extension of EVA (economic value added), a metric that became popular in the 1990s, when companies used it to measure profitability not just at the corporate level, but also at the level of business units and individual projects.

EVA is described by Bennett Stewart, senior partner at consulting firm Stern Stewart & Co., which has trademarked the acronym, as an estimate of the amount by which earnings exceed or fall short of the rate of return shareholders and lenders could get by investing in other securities of comparable risk. "EVA is a practical method of estimating the economic profit that is earned, as opposed to the accounting profit," he says. "It's really a finance tool for nonfinance executives. Finance execs don't need EVA."

"It simplifies everything," insists Sal Fazzolari, senior vice president, CFO, and treasurer of Harsco Corp., a Camp Hill, Pennsylvania-based industrial-services firm, which began implementing MVA and EVA as financial-measurement tools in 2001. "It's one measurement for everyone in the company to concentrate on. It takes into consideration all of a company's financials."

At the heart of MVA and EVA are the beliefs that (1) the primary objective of management should be to maximize return to shareholders and (2) a company should earn more than its cost of investment.

In a nutshell, EVA is equal to a company's net operating profits after taxes (NOPAT) minus a capital charge — the amount of capital invested in the business times the cost of capital. EVA converts the balance sheet and income statement into one measurement of profit, Stewart explains.

"It's as if the company ended up with no assets and leased everything, factored all receivables," and so on, he says, adding, "it's the profit that would be reported if all assets were externally financed." Stewart argues that looking at financials in this way enables a company to truly understand whether it is profitable because it manages assets well or simply because it is an owner of assets.

Fazzolari says that for many years, different business units at Harsco focused on a variety of metrics, such as return on capital, return on sales, net income, and sales. "These metrics can send you in different directions," he says. "EVA makes you focus on all of the financial statements."

EVA has enabled Harsco to improve its capital-allocation process by standardizing the way each manager and employee analyzes a project. For example, if a customer requests an extra 30 days to pay its bill, Harsco's employees can immediately calculate the potential financial impact on the company. Each month, Harsco calculates EVA by business unit. "It is automatically generated," says Fazzolari. Each employee can then access the tools needed to calculate EVA.

At consulting firm Accenture, EVA performance is linked with compensation for the firm's partners. "A big portion of our partners' and units' compensation is based on EVA generation," explains CFO Harry You. You likens EVA to a more precise version of return on invested capital. He also uses EVA in doing business with clients. "We look at the way we can create EVA for them," he says. "We're selling our business based on how we sell EVA to our clients. A vast majority of our clients may not use it, but they understand it."

Defining MVA
"EVA is the most important empirical link to MVA," says Stewart. The change in EVA explains 35 percent of the change in MVA, or seven times more than sales growth, while the change in earnings per share explains only about 3 percent of the change in MVA.

MVA itself is the stock market's assessment of the net present value (NPV) of EVA. In other words, MVA is the difference between the market value of a company (which includes both equity and debt) and the capital that lenders and shareholders have entrusted to the company over the years. Thus, MVA is a measure of the difference between "cash in" (what investors have contributed) and "cash out" (what they could get by selling at today's prices), Stewart explains.

If MVA is positive, it means that the company has increased the value of the capital entrusted to it and thus created shareholder wealth. If MVA is negative, the company has destroyed wealth.

Like all other metrics, says Accenture's You, MVA has its limitations. For one thing, like a company's price-to-earnings ratio, it is in part captive to the vagaries of the stock market. "Over longer periods, MVA correlates with EVA, but over a shorter time, it may not," he insists.

On the other hand, MVA is a better measure of a company's shareholder-wealth creation than simple market capitalization. Take, for example, Verizon Communications. The telecom giant's market value is $200 billion, nearly the size of Microsoft's. Although one would think the two companies therefore rewarded their shareholders equally, Microsoft's MVA is 13 times greater than Verizon's. This is because Verizon issued $65 billion of stock to buy GTE in 2000, skewing its market value growth.


And this transaction followed by just three years the all-stock merger of Bell Atlantic and Nynex that first created Verizon. In the past 10 years, Verizon's total return to shareholders has been only 7.84 percent, according to Stewart.

All High Performers Are Not Alike
The top three performers, according to the MVA ranking of Tier-1 companies, are General Electric, Microsoft, and Wal-Mart Stores. (Note: The rankings delineate Tier 1, Tier 2, and Tier 3 companies by size.) Although representing diverse industry sectors and business strategies, all three companies have created nearly the same amount of wealth for their shareholders — GE, $223 billion; Microsoft, $212 billion; and Wal-Mart, $207 billion.

Wal-Mart had $246 billion in sales in the most recent year, while Microsoft had "only" $31 billion. GE has $156 billion in long-term debt, while Microsoft has none. Microsoft's return on average capital is nearly twice that of the other two companies.

Of the top three companies, GE has the highest MVA and highest EVA. Wal-Mart's EVA is higher than Microsoft's, which means that the market is projecting different rates of growth for these companies. The fact that Microsoft has about the same MVA but a much lower EVA than GE means the market believes Microsoft has a greater opportunity to grow. This is partly underscored by its 22 percent return on average capital, which is nearly double that of its two MVA peers.

What does it mean that GE has the highest MVA and EVA? "If the MVA for GE is the same as for the other two companies, that means GE has less prospect for growth compared with the other two," Stewart explains. In fact, although its EVA has grown somewhat over the past three years, its MVA has eroded by more than 17 times that of Wal-Mart over the three-year period. "[Its MVA score suggests] that GE doesn't have the same intrinsic growth opportunity.

Wal-Mart has stupendous growth prospects but the lowest return on capital, so it has significant growth at lower margins. Microsoft, on the other hand, is a higher-growth, higher-return company. GE has a low-return, low-growth base, and a modest chance to grow its EVA," he adds.

Perhaps the most impressive large companies in the Tier-1 ranking are Procter & Gamble and Johnson & Johnson, which show the best three-year improvements in MVA. (Changes in rankings between 1999 and 2002 are shown on the charts beginning on page 62, while three-year averages for EVA and MVA are available at www.cfo.com.) Procter & Gamble leaped from number 32 in 1999 to number 6 in 2002 in terms of MVA. Biopharmaceuticals company Gilead Sciences showed the highest three-year MVA gain among the 25 largest market-cap companies with less than $700 million in revenues, rising to second place from number 174 three years ago.

Technology companies rank high in terms of MVA despite the short life span of many new technology and Internet companies. Six of the 14 top large companies are tech companies; Ebay and Qualcomm fall among the top four midsize (Tier 2) companies, and Linear Technology is the highest company with sales below $700 million (Tier 3). From 1999 to 2002, Ebay, in fact, moved from number 25 to number 2 among companies with sales between $700 million and $7 billion, and now boasts twice the MVA of Amazon.com.

It's not quite the magic number that will enable a company to understand precisely what it needs to do to maximize shareholder value and increase profitability. But MVA at least offers one of the least deceptive of mirrors for companies seeking to know whether they are the fairest of their peers.



What The Acronyms Mean
MVAMarket Value AddedThe difference between total market value (value of equity and debt) and invested capital (money/cash investors contributed to the business). It measures the difference between what investors "put" into the company and what it is currently worth. MVA is also equal to the present value of all future EVAs.
EVAEconomic Value AddedReal measure of economic profit. This is calculated by reducing the full cost of capital from NOPAT — net operating profit after taxes. The full cost of capital captures the opportunity cost of all invested capital at the blended cost of equity and debt as applied by the specific business.
P ScoreA measure of performance based on one-year sales growth; EVA/sales; EVA/capital; and one-year change in EVA over capital.
R ScoreA measure of riskiness. It looks at stock-return volatility, leverage, cash flow, and size.




2003 MVA Rankings
Tier 1: 45 largest market-cap companies with sales of more than $7 billion
20021999Company nameMVAMVCapitalEVASaleGrowth1Performance2Risk3
12General Electric Co222,767 322,19099,423 5,983 73,420 32%79%4%
24Microsoft Corp212,340 237,54725,207 2,201 30,785 41%78%7%
36Wal-Mart Stores207,346 280,97073,624 2,928 244,524 48%79%8%
422Johnson & Johnson124,237 171,82947,592 2,839 36,298 32%90%4%
512Merck & Co107,076 144,62437,548 3,872 51,790 58%87%2%
632Procter & Gamble Co92,231 133,24841,017 2,315 42,606 7%79%3%
78Intl Business Machines Corp90,422 193,955103,533 (8,032)81,186 -7%9%23%
813Exxon Mobil Corp85,108 273,634188,526 (2,175)178,909 11%30%1%
921Coca-Cola Co82,413 107,00724,594 2,496 19,983 2%85%2%
103Intel Corp77,395 114,57437,179 (3,736)26,764 -9%5%18%
1114Dell Computer Corp69,425 76,6377,212 360 33,730 43%59%17%
1216Citigroup Inc68,078 176,795108,716 2,964 92,029 12%65%7%
131Cisco Systems Inc59,702 109,24949,547 (4,623)19,209 28%15%36%
145Oracle Corp59,502 60,453951 1,401 9,417 -3%77%27%
1524Lilly (Eli) & Co57,366 74,76117,395 1,096 11,078 12%68%7%
1629United Parcel Service Inc57,036 77,34720,312 875 31,272 16%65%2%
1738Fannie Mae54,181 64,49610,315 2,457 52,901 43%92%0%
1811Pfizer Inc52,683 194,393141,711 (2,779)32,373 100%35%24%
1940Pepsico Inc49,718 81,18431,466 1,258 25,541 31%87%14%
2036Abbott Laboratories49,181 71,35222,171 1,562 17,685 34%88%11%
2118Home Depot Inc43,955 69,63525,680 1,346 58,247 52%85%11%
22573M Co41,012 55,76814,756 817 16,332 4%75%2%
2319American International Group40,845 129,05688,211 (1,249)67,482 66%47%5%
2437Medtronic Inc40,778 60,41619,639 (26)7,309 55%53%11%
2533Pharmacia Corp40,679 62,89722,218 (1,078)13,993 53%36%5%
2631Wyeth38,443 66,20627,763 696 14,584 8%72%10%
2752Comcast Corp38,008 112,53074,522 (3,555)12,460 101%19%62%
2856Anheuser-Busch Cos Inc37,916 50,53612,620 1,314 13,566 16%91%2%
2946Du Pont (E I) De Nemours35,445 59,86224,417 (96)24,134 -11%29%2%
3023Bristol Myers Squibb33,872 58,01524,142 777 18,119 7%58%3%
3164Federal Home Loan Mortg Corp28,984 36,5007,516 4,134 36,173 100%NANA
3270Altria Group Inc28,230 102,08273,852 6,696 62,182 1%82%9%
3330American Express27,539 43,67116,132 707 24,649 10%61%2%
3454Colgate-Palmolive Co26,687 35,6868,999 734 9,294 2%83%7%
3586Lowes Cos25,152 39,66514,513 226 26,491 67%75%33%
36112Unitedhealth Group Inc25,004 31,3026,298 856 25,020 28%91%6%
3762Walgreen Co24,417 40,48816,071 572 30,564 56%83%26%
3860Wells Fargo & Co24,065 75,53751,473 744 28,473 31%67%1%
3925Bellsouth Corp21,787 70,58048,793 (1,286)22,711 -10%17%11%
40.Kraft Foods Inc21,770 73,52451,754 732 29,723 11%63%NA
4192Bank Of America Corp20,427 100,41879,992 341 46,362 -10%38%0%
4263Target Corp19,698 42,84623,148 432 43,917 30%68%43%
4391First Data Corp19,323 29,34610,023 503 7,636 38%88%13%
4461Gillette Co17,738 36,77119,033 (432)8,453 -15%24%6%
4626Verizon Communications16,138 200,132183,994 (5,612)67,625 104%35%48%
4834Schering-Plough15,930 27,21111,281 80 10,180 11%63%5%
5072United Technologies Corp15,740 42,81627,076 721 28,541 14%62%16%
5139Morgan Stanley15,234 41,79026,556 86 32,242 -5%40%6%
52188Lockheed Martin Corp13,943 35,59321,650 (549)26,578 4%40%22%
5353Automatic Data Processing13,740 32,33918,599 (332)10,084 48%32%23%
5478Emerson Electric Co13,734 26,54312,809 (88)13,770 -4%31%4%
5517Texas Instruments Inc13,346 32,59319,247 (3,151)8,383 -11%4%47%
5793General Mills Inc12,073 27,35815,285 72 10,284 56%71%49%
58115Southern Co11,817 34,35822,541 502 10,549 -9%64%11%
5966Goldman Sachs Group Inc11,369 32,13020,761 (322)22,854 -10%32%16%
6045Nextel Communications11,233 28,55917,326 (1,521)8,721 162%47%80%
6255Viacom Inc -Cl B10,682 99,36288,680 (5,092)24,606 91%21%45%
6582Dow Chemical10,098 52,96842,870 (2,145)27,609 46%23%46%
6928Disney (Walt) Co9,282 56,97447,692 (2,072)25,779 8%21%25%
74140Fedex Corp8,558 31,04122,483 (596)22,073 24%37%29%
7544McDonalds Corp8,339 38,17929,840 (39)15,406 16%47%23%
7685Clear Channel Communications8,299 34,96626,668 (2,040)8,421 214%33%58%
78122Dominion Resources Inc7,897 35,11727,220 533 10,218 85%80%44%
7998Fox Entertainment Group Inc7,721 29,43921,719 (941)10,413 31%35%29%
8073Merrill Lynch & Co7,697 32,69124,994 (208)28,152 -19%29%19%
81144Exelon Corp7,532 36,34628,814 719 14,955 175%87%56%
8276Kimberly-Clark Corp7,518 31,21023,692 (12)13,566 4%40%8%
87162Cardinal Health Inc6,960 27,51320,553 (386)53,447 71%49%10%
9377Alcoa Inc5,822 33,71327,891 (1,130)20,263 24%21%49%
9520Hewlett-Packard Co5,476 63,24357,767 (3,726)63,082 44%24%61%
106106Conocophillips3,963 63,94359,980 (849)50,512 272%61%45%
108102Cigna Corp3,826 85,43681,611 (3,967)19,343 3%23%5%
11348Ford Motor Co3,459 69,21865,758 (4,826)134,425 0%12%67%
11747Chevrontexaco Corp3,135 93,45790,322 (3,139)91,685 191%60%26%
122193Union Pacific Corp2,637 28,63425,997 (89)12,491 11%45%21%
124249Washington Mutual Inc2,599 33,13530,536 1,215 18,755 38%87%6%
127184Firstenergy Corp2,515 30,66128,146 (77)12,152 92%63%48%
13380Aes Corp. (The)2,091 29,80327,713 (2,207)8,632 165%28%86%
138240UAL Corp1,842 35,65933,816 (4,219)14,286 -21%NANA
140104Cendant Corp1,801 36,49734,696 (537)14,088 162%50%88%
145153U S Bancorp1,407 36,38434,977 (28)15,422 140%72%19%
146169Pg&E Corp1,405 27,49826,093 (1,235)12,495 -40%17%55%
184232Intl Paper Co(313)37,97338,287 (1,317)24,976 2%21%44%
196216Northrop Grumman Corp(748)34,21634,965 (721)17,206 91%41%66%
200186Delta Air Lines Inc(1,049)27,44528,495 (2,161)13,305 -10%6%69%
217123Xerox Corp(2,240)28,17030,411 (1,123)15,849 -18%18%58%
223244AMR Corp/De(2,763)31,04933,812 (3,459)17,326 -2%5%82%
228114El Paso Corp(3,864)28,81732,681 (2,273)12,194 15%30%77%
229118Boeing Co(3,871)48,64252,513 (542)54,069 -7%31%34%
237247Bank One Corp(6,577)40,16446,741 (1,597)22,171 -13%16%5%
238233Sears Roebuck & Co(6,859)44,89851,758 (314)41,366 1%39%59%
240241AT&T Wireless Services Inc(7,106)36,24943,355 (5,102)15,631 105%18%83%
24467Honeywell International Inc(9,231)32,84642,078 (833)22,274 -6%18%42%
245251Wachovia Corp(10,182)45,83956,021 (1,762)23,591 7%22%10%
246101General Motors Corp(14,081)105,697119,778 (5,065)155,974 2%27%40%
24727Motorola Inc(15,904)30,03045,934 (5,849)26,679 -17%4%56%
24850J P Morgan Chase & Co(25,499)47,46672,965 (3,646)43,372 29%17%22%
2499AOL Time Warner Inc(27,148)103,550130,697 (27,539)40,961 757%17%81%
25142SBC Communications Inc(38,372)118,558156,930 (8,434)43,138 -13%9%14%
25265AT&T Corp(72,674)75,733148,406 (27,116)49,931 -20%4%23%
Notes: All values — except for the performance and risk measures — are in millions. MVA rankings are based on all Tier-1 companies. Since some Tier-1 companies have low MVA rankings, numbers are not sequential. 1Three-year cumulative aggregate sales growth. 2Indicates the company's ranking for operating performance relative to Russell 1,000 companies. The measure runs from 0 to 100. The higher the number, the stronger the company's operating performance. 3Indicates the company's ranking for risk relative to Russell 1,000 companies. The measure runs from 0 to 100. The lower the number, the less risky the company.




2003 MVA Rankings
Tier 2: 25 largest market-cap companies with sales between $700 million and $7 billion
20021999Company nameMVAMVCapitalEVASaleGrowth1Performance2Risk3
16Amgen Inc57,361 80,204 22,844 (103)5,523 65%76%57%
225Ebay Inc25,489 29,094 3,606 (156)1,214 440%32%90%
385Forest Laboratories -Cl A17,200 19,006 1,806 307 2,022 156%99%NA
42Qualcomm Inc17,167 24,194 7,027 (721)3,785 -3%11%54%
592Slm Corp15,425 16,820 1,395 589 3,436 5%99%8%
635Cox Communications -Cl A15,324 27,993 12,669 (489)5,039 117%51%16%
714Echostar Commun Corp -Cl A15,076 19,107 4,031 (583)4,821 201%28%91%
836Fifth Third Bancorp14,945 28,846 13,901 328 6,317 75%85%15%
945Gannett Co13,989 25,702 11,713 153 6,422 22%58%18%
1061Avon Products12,867 16,165 3,298 363 6,228 18%87%30%
115Applied Materials Inc12,546 21,322 8,776 (1,328)5,116 -15%4%52%
1224Amazon.Com Inc11,891 14,079 2,188 (164)4,169 117%50%89%
1389Stryker Corp11,729 14,432 2,703 147 3,012 43%89%22%
1415Liberty Media Corp -Ser A11,658 36,530 24,872 NA2,084 106%NANA
15107Boston Scientific Corp11,599 19,638 8,039 (143)2,919 3%32%46%
1650Harley-Davidson Inc11,291 13,897 2,607 352 4,302 66%97%13%
1720Genentech Inc11,095 19,037 7,942 (621)2,618 97%45%46%
1882Wrigley (Wm) Jr Co10,894 12,848 1,955 283 2,746 33%95%NA
19115Bed Bath & Beyond Inc10,746 13,496 2,749 93 3,495 103%88%NA
2288Tribune Co9,633 20,676 11,043 (388)5,384 67%26%47%
231Emc Corp/Ma9,358 19,646 10,289 (1,652)5,438 -19%3%47%
2670Southwest Airlines8,650 16,546 7,896 (413)5,580 14%17%40%
2873Mcgraw-Hill Companies8,359 13,362 5,003 88 4,788 20%63%9%
3041Cablevision Sys Corp -Cl A7,929 17,344 9,414 (706)4,003 2%32%77%
3122Bank Of New York Co Inc7,857 14,888 7,031 421 5,756 -5%54%3%
3237Guidant Corp7,847 12,504 4,656 306 3,240 38%93%31%
36142Praxair Inc6,836 13,611 6,775 123 5,128 11%62%23%
3871Pitney Bowes Inc6,808 13,141 6,333 213 4,410 -1%70%19%
3964Campbell Soup Co6,796 12,984 6,189 279 6,217 -6%59%19%
4599Danaher Corp6,341 12,676 6,336 17 4,577 43%60%49%
5483Usa Interactive5,537 15,364 9,827 1,247 4,621 43%81%20%
66151Air Products & Chemicals Inc4,821 12,911 8,090 5 5,532 10%45%30%
71302Newmont Mining Corp4,531 14,597 10,066 (185)2,658 90%49%82%
74165Apache Corp4,387 12,575 8,187 86 2,560 97%86%65%
78130Anadarko Petroleum Corp4,156 17,686 13,529 20 3,860 451%77%78%
813Yahoo Inc3,906 14,463 10,557 (1,931)953 62%20%74%
88242Ppl Corp3,755 15,180 11,424 306 5,429 18%74%58%
110163BB&T Corp2,966 14,775 11,808 157 6,127 58%72%10%
118386Sempra Energy2,713 13,146 10,433 244 6,020 12%63%37%
133131Unocal Corp2,470 12,689 10,219 (343)5,224 -11%18%28%
185516Dte Energy Co1,826 18,323 16,497 199 6,749 43%69%47%
225223Devon Energy Corp1,425 15,227 13,802 (304)4,316 488%51%84%
263597Norfolk Southern Corp1,154 17,746 16,592 (343)6,270 19%37%45%
431418Nisource Inc509 13,687 13,178 79 6,094 94%62%66%
451616Burlington Resources Inc448 13,915 13,468 (329)2,964 44%34%50%
48918Computer Associates Intl Inc359 13,477 13,118 (1,924)3,087 -47%3%66%
923945Allied Waste Inds Inc(1,546)13,176 14,722 (295)5,517 65%41%66%
93553Williams Cos Inc(2,137)21,149 23,286 (876)5,608 -35%10%71%
94175Dynegy Inc(2,695)13,779 16,474 (1,267)5,553 -64%NANA
949865Charter Communications Inc(5,715)21,169 26,884 (2,429)4,566 220%27%91%
Notes: All values — except for the performance and risk measures — are in millions. MVA rankings are based on all Tier-1 companies. Since some Tier-1 companies have low MVA rankings, numbers are not sequential. 1Three-year cumulative aggregate sales growth. 2Indicates the company's ranking for operating performance relative to Russell 1,000 companies. The measure runs from 0 to 100. The higher the number, the stronger the company's operating performance. 3Indicates the company's ranking for risk relative to Russell 1,000 companies. The measure runs from 0 to 100. The lower the number, the less risky the company.




2003 MVA Rankings
Tier 3: 25 largest market-cap companies with sales below $700 million
20021999Company nameMVAMVCapitalEVASaleGrowth1Performance2Risk3
17Linear Technology Corp9,025 9,584 559 27 558 -4%52%45%
2174Gilead Sciences Inc7,956 9,754 1,798 (135)467 176%43%92%
370Idec Pharmaceuticals Corp4,077 5,829 1,753 (57)404 243%28%96%
447Microchip Technology Inc3,133 4,331 1,198 (89)649 42%20%NA
671Westwood One Inc2,879 4,129 1,250 (14)551 54%49%57%
7157Pixar2,709 3,285 577 31 202 67%98%NA
8111Sei Investments Co2,447 2,766 318 109 621 36%96%35%
914Citrix Systems Inc2,391 3,558 1,167 (197)527 31%6%94%
1025Mercury Interactive Corp2,358 3,016 658 (125)400 113%13%97%
1123Qlogic Corp2,240 3,587 1,347 (163)411 120%15%NA
121Juniper Networks Inc2,126 4,539 2,413 (427)547 433%16%98%
13384Memc Electronic Matrials Inc2,107 2,755 648 (21)687 -1%NANA
141232Scios Inc2,069 2,422 353 (112)111 83%NANA
15286Patterson-Uti Energy Inc1,883 2,652 769 (81)528 248%57%NA
16608Chicos Fas Inc1,847 2,123 276 38 494 253%99%93%
1767Ensco International Inc1,843 4,363 2,521 (117)698 92%32%87%
1828Sepracor Inc1,807 2,577 770 (349)239 955%NANA
20108Rcn Corp1,737 4,369 2,632 (1,090)457 66%NANA
21102Gentex Corp1,723 2,268 545 37 395 51%92%NA
22477Brown & Brown Inc1,672 2,132 460 63 456 158%100%59%
23.Jetblue Airways Corp1,589 3,132 1,543 (15)635 NA49%NA
24474Fair Isaac Corp1,562 2,579 1,018 (55)454 63%25%89%
25185Entercom Communications Corp1,547 3,052 1,505 (59)391 82%47%88%
2749Hispanic Broadcasting -Cl A1,520 2,843 1,323 (94)257 30%20%74%
31141Cephalon Inc1,407 3,126 1,719 23 507 1028%55%100%
32173Intl Speedway Corp -Cl A1,400 2,380 979 20 556 70%74%40%
34498Education Management Corp1,364 2,117 753 30 582 105%93%94%
36287Sicor Inc1,351 2,200 849 49 456 99%97%90%
3743Nextel Partners Inc1,328 3,005 1,677 (349)671 1950%NANA
42216Valley National Bancorp1,233 2,222 989 45 595 25%80%22%
461491Capitol Federal Financial1,201 2,193 992 (1)587 43%56%6%
56137Cox Radio Inc -Cl A1,101 2,929 1,828 (89)421 40%49%85%
65363Philadelphia Suburban Corp1,039 2,497 1,458 12 322 25%68%79%
66427Paxson Comm Corp -Cl A1,032 2,256 1,224 (339)270 28%NANA
7462Ameritrade Holding Corp955 2,135 1,181 (64)443 41%NANA
82493Leucadia National Corp922 2,131 1,208 (111)242 -66%3%43%
84117Rowan Cos Inc919 2,738 1,820 (161)617 34%12%94%
93369Getty Images Inc830 2,153 1,323 (107)463 87%35%93%
99167Newfield Exploration Co789 2,700 1,911 (21)662 135%77%95%
105392Lee Enterprises764 2,185 1,421 20 589 45%81%75%
11384Checkfree Corp689 2,634 1,945 (350)518 88%13%96%
359.Westport Resources Corp258 2,218 1,960 (131)428 480%NANA
502158Radio One Inc167 2,237 2,069 (13)286 310%57%100%
64188Intersil Corp -Cl A112 2,539 2,427 (262)650 22%7%90%
7951437Extended Stay America Inc70 2,337 2,267 (65)548 31%27%90%
929186Emmis Communictns Cp -Cl A37 2,326 2,289 (142)554 82%23%97%
1370177Invitrogen Corp(134)2,204 2,338 (203)649 849%18%99%
14931509Stewart Enterprises -Cl A(866)2,462 3,328 (127)559 -27%NANA
149530Millennium Pharmactcls Inc(920)3,684 4,604 (653)353 92%12%98%
15068Ciena Corp(2,036)2,268 4,304 (1,537)269 -50%0%99%
Notes: All values — except for the performance and risk measures — are in millions. MVA rankings are based on all Tier-1 companies. Since some Tier-1 companies have low MVA rankings, numbers are not sequential. 1Three-year cumulative aggregate sales growth. 2Indicates the company's ranking for operating performance relative to Russell 1,000 companies. The measure runs from 0 to 100. The higher the number, the stronger the company's operating performance. 3Indicates the company's ranking for risk relative to Russell 1,000 companies. The measure runs from 0 to 100. The lower the number, the less risky the company.



MVA by Industry


  Number  Ticker  Company name2002  
AUTOMOBILES & COMPONENTS
TOP 5
  1  HDI  Harley-Davidson Inc11,291  
  2  PCAR  Paccar Inc3,816  
  3  F  Ford Motor Co3,459  
  4  RAY  Raytech Corp/De2,995  
  5  JCI  Johnson Controls Inc2,778  
BOTTOM 5
  1  GM  General Motors Corp(14,081)  
  2  VC  Visteon Corp(3,948)  
  3  GT  Goodyear Tire & Rubber Co(3,062)  
  4  DCN  Dana Corp(2,279)  
  5  TEN  Tenneco Automotive Inc(1,237)  




  Number  Ticker  Company name2002  
BANKS
TOP 5
  1  WFC  Wells Fargo & Co24,065  
  2  BAC  Bank Of America Corp20,427  
  3  FITB  Fifth Third Bancorp14,945  
  4  BK  Bank Of New York Co Inc7,857  
  5  STI  Suntrust Banks Inc6,566  
BOTTOM 5
  1  WB  Wachovia Corp(10,182)  
  2  FBF  Fleetboston Financial Corp(8,408)  
  3  ONE  Bank One Corp(6,577)  
  4  CFB  Commercial Federal(568)  
  5  SOV  Sovereign Bancorp Inc(513)  




  Number  Ticker  Company name2002  
CAPITAL GOODS
TOP 5
  1  GE  General Electric Co222,767  
  2  MMM  3M Co41,012  
  3  UTX  United Technologies Corp15,740  
  4  LMT  Lockheed Martin Corp13,943  
  5  EMR  Emerson Electric Co13,734  
BOTTOM 5
  1  HON  Honeywell International Inc(9,231)  
  2  BA  Boeing Co(3,871)  
  3  GR  Goodrich Corp(2,543)  
  4  RTN  Raytheon Co(1,690)  
  5  WLT  Walter Industries Inc(1,262)  




  Number  Ticker  Company name2002  
COMMERCIAL SVCS & SUPPLIES
TOP 5
  1  FDC  First Data Corp19,323  
  2  ADP  Automatic Data Processing13,740  
  3  PAYX  Paychex Inc10,468  
  4  APOL  Apollo Group Inc -Cl A8,852  
  5  PBI  Pitney Bowes Inc6,808  
BOTTOM 5
  1  AW  Allied Waste Inds Inc(1,546)  
  2  POI  Protection One Inc(1,043)  
  3  CPC  Central Parking Corp(680)  
  4  SCS  Steelcase Inc(551)  
  5  SFN  Spherion Corp(440)  




  Number  Ticker  Company name2002  
CONSUMER DURABLES & APPAREL
TOP 5
  1  NKE  Nike Inc -Cl B8,906  
  2  COH  Coach Inc3,559  
  3  LIZ  Liz Claiborne Inc2,104  
  4  NVR  Nvr Inc2,123  
  5  LEG  Leggett & Platt Inc1,885  
BOTTOM 5
  1  EK  Eastman Kodak Co(2,947)  
  2  AM  American Greetings -Cl A(599)  
  3  UFI  Unifi Inc(356)  
  4  IFSIA  Interface Inc -Cl A(301)  
  5  WLM  Wellman Inc(263)  




  Number  Ticker  Company name2002  
DIVERSIFIED FINANCIALS
TOP 5
  1  C  Citigroup Inc68,078  
  2  FNM  Fannie Mae54,181  
  3  FRE  Federal Home Loan Mortg Corp28,984  
  4  AXP  American Express27,539  
  5  SLM  Slm Corp15,425  
BOTTOM 5
  1  JPM  J P Morgan Chase & Co(25,499)  
  2  HI  Household International Inc(5,472)  
  3  ET  E Trade Group Inc(1,355)  
  4  PVN  Providian Financial Corp(1,331)  
  5  NITE  Knight Trading Group Inc(806)  




  Number  Ticker  Company name2002  
ENERGY
TOP 5
  1  XOM  Exxon Mobil Corp85,108  
  2  APA  Apache Corp4,387  
  3  BJS  Bj Services Co4,232  
  4  APC  Anadarko Petroleum Corp4,156  
  5  BHI  Baker-Hughes Inc4,126  
BOTTOM 5
  1  AHC  Amerada Hess Corp(2,315)  
  2  HAL  Halliburton Co(555)  
  3  TSO  Tesoro Petroleum Corp(468)  
  4  ASH  Ashland Inc(415)  
  5  HC  Hanover Compressor Co(370)  




  Number  Ticker  Company name2002  
FOOD & DRUG RETAILING
TOP 5
  1  WAG  Walgreen Co24,417  
  2  SYY  Sysco Corp16,667  
  3  WFMI  Whole Foods Market Inc2,705  
  4  SWY  Safeway Inc1,641  
  5  PFGC  Performance Food Group Co853  
BOTTOM 5
  1  ABS  Albertsons Inc(7,207)  
  2  KR  Kroger Co(2,103)  
  3  3FLMIQ  Fleming Companies Inc(2,005)  
  4  CVS  Cvs Corp(1,667)  
  5  GAP  Great Atlantic & Pac Tea Co(749)  




  Number  Ticker  Company name2002  
FOOD BEVERAGE & TOBACCO
TOP 5
  1  KO  Coca-Cola Co82,413  
  2  PEP  Pepsico Inc49,718  
  3  BUD  Anheuser-Busch Cos Inc37,916  
  4  MO  Altria Group Inc28,230  
  5  KFT  Kraft Foods Inc21,770  
BOTTOM 5
  1  RJR  Rj Reynolds Tobacco Hldgs(5,406)  
  2  TSN  Tyson Foods Inc -Cl A(1,292)  
  3  CQB  Chiquita Brands Intl(444)  
  4  AOR  Aurora Foods Inc(425)  
  5  ADM  Archer-Daniels-Midland Co(395)  




  Number  Ticker  Company name2002  
HEALTH CARE EQUIPMENT & SVCS
TOP 5
  1  MDT  Medtronic Inc40,778  
  2  UNH  Unitedhealth Group Inc25,004  
  3  SYK  Stryker Corp11,729  
  4  BSX  Boston Scientific Corp11,599  
  5  HCA  Hca Inc5,302  
BOTTOM 5
  1  KIND  Kindred Healthcare Inc(12,093)  
  2  MCK  Mckesson Corp(7,852)  
  3  HLTH  Webmd Corp(5,155)  
  4  THC  Tenet Healthcare Corp(3,841)  
  5  SRV  Service Corp International(1,925)  




  Number  Ticker  Company name2002  
HOTELS RESTAURANTS & LEISURE
TOP 5
  1  SBUX  Starbucks Corp7,448  
  2  YUM  Yum Brands Inc5,693  
  3  IGT  Intl Game Technology5,938  
  4  MCD  McDonalds Corp8,339  
  5  MAR  Marriott Intl Inc4,361  
BOTTOM 5
  1  PPE  Park Place Entmt Corp(2,232)  
  2  WBR  Wyndham Intl Inc(2,028)  
  3  PKS  Six Flags Inc(1,168)  
  4  PDQ  Prime Hospitality Corp(673)  
  5  BFT  Bally Total Fitness Hldg Cp(486)  




  Number  Ticker  Company name2002  
HOUSEHOLD & PERSONAL PRODS
TOP 5
  1  PG  Procter & Gamble Co92,231  
  2  CL  Colgate-Palmolive Co26,687  
  3  G  Gillette Co17,738  
  4  AVP  Avon Products12,867  
  5  CLX  Clorox Co/De5,849  
BOTTOM 5
  1  PYX  Playtex Products Inc(94)  
  2  RDEN  Elizabeth Arden Inc13  
  3  NATR  Natures Sunshine Prods Inc26  
  4  IPAR  Inter Parfums Inc53  
  5  ROV  Rayovac Corp64  




  Number  Ticker  Company name2002  
INSURANCE
TOP 5
  1  AIG  American International Group40,845  
  2  MMC  Marsh & Mclennan Cos16,133  
  3  AFL  Aflac Inc12,844  
  4  PGR  Progressive Corp-Ohio9,283  
  5  ALL  Allstate Corp7,198  
BOTTOM 5
  1  UNM  Unumprovident Corp(6,888)  
  2  PRU  Prudential Financial Inc(6,212)  
  3  LTR  Loews Corp(2,722)  
  4  NFS  Nationwide Finl Svcs -Cl A(2,707)  
  5  AFC  Allmerica Financial Corp(1,633)  




  Number  Ticker  Company name2002  
MATERIALS
TOP 5
  1  DD  Du Pont (E I) De Nemours35,445  
  2  PX  Praxair Inc6,836  
  3  DOW  Dow Chemical10,098  
  4  ECL  Ecolab Inc5,393  
  5  APD  Air Products & Chemicals Inc4,821  
BOTTOM 5
  1  CCK  Crown Holdings Inc(3,000)  
  2  OI  Owens-Illinois Inc(2,832)  
  3  MON  Monsanto Co(2,509)  
  4  IGL  Imc Global Inc(2,228)  
  5  GP  Georgia-Pacific Corp(2,077)  




  Number  Ticker  Company name2002  
MEDIA
TOP 5
  1  CMCSA  Comcast Corp38,008  
  2  COX  Cox Communications -Cl A15,324  
  3  DISH  Echostar Commun Corp -Cl A15,076  
  4  GCI  Gannett Co13,989  
  5  L  Liberty Media Corp -Ser A11,658  
BOTTOM 5
  1  AOL  AOL Time Warner Inc(27,148)  
  2  CHTR  Charter Communications Inc(5,715)  
  3  GMST  Gemstar-Tv Guide Intl Inc(5,125)  
  4  IPG  Interpublic Group Of Cos(1,520)  
  5  SPOT  Panamsat Corp(784)  




  Number  Ticker  Company name2002  
PHARMACEUTICALS & BIOTECH
TOP 5
  1  JNJ  Johnson & Johnson124,237  
  2  MRK  Merck & Co107,076  
  3  PFE  Pfizer Inc52,683  
  4  AMGN  Amgen Inc57,361  
  5  LLY  Lilly (Eli) & Co57,366  
BOTTOM 5
  1  MLNM  Millennium Pharmactcls Inc(920)  
  2  ICN  Icn Pharmaceuticals Inc(782)  
  3  CRA  Applera Corp Celera Genomics(633)  
  4  ALO  Alpharma Inc -Cl A(547)  
  5  CRXA  Corixa Corp(546)  




  Number  Ticker  Company name2002  
RETAILING
TOP 5
  1  WMT  Wal-Mart Stores207,346  
  2  HD  Home Depot Inc43,955  
  3  LOW  Lowes Cos25,152  
  4  EBAY  Ebay Inc25,489  
  5  TGT  Target Corp19,698  
BOTTOM 5
  1  S  Sears Roebuck & Co(6,859)  
  2  BBI  Blockbuster Inc(4,758)  
  3  JCP  Penney (J C) Co(4,557)  
  4  FD  Federated Dept Stores(2,506)  
  5  TOY  Toys R Us Inc(2,321)  




  Number  Ticker  Company name2002  
SOFTWARE & SERVICES
TOP 5
  1  MSFT  Microsoft Corp212,340  
  2  ORCL  Oracle Corp59,502  
  3  ERTS  Electronic Arts Inc6,783  
  4  ADBE  Adobe Systems Inc.6,450  
  5  INTU  Intuit Inc5,476  
BOTTOM 5
  1  VRSN  Verisign Inc(14,805)  
  2  ITWOE  I2 Technologies Inc(7,260)  
  3  EPNY  E.Piphany Inc(2,540)  
  4  UIS  Unisys Corp(1,800)  
  5  AKAM  Akamai Technologies Inc(1,786)  




  Number  Ticker  Company name2002  
TECHNOLOGY HARDWARE & EQUIP
TOP 5
  1  IBM  Intl Business Machines Corp90,422  
  2  DELL  Dell Computer Corp69,425  
  3  INTC  Intel Corp77,395  
  4  CSCO  Cisco Systems Inc59,702  
  5  QCOM  Qualcomm Inc17,167  
BOTTOM 5
  1  JDSU  Jds Uniphase Corp(35,218)  
  2  LU  Lucent Technologies Inc(34,657)  
  3  MOT  Motorola Inc(15,904)  
  4  GLW  Corning Inc(7,921)  
  5  COMS  3Com Corp(7,873)  




  Number  Ticker  Company name2002  
TELECOMMUNICATION SERVICES
TOP 5
  1  BLS  Bellsouth Corp21,787  
  2  VZ  Verizon Communications16,138  
  3  NXTL  Nextel Communications11,233  
  4  AT  Alltel Corp4,312  
  5  PCS  Sprint Pcs Group2,624  
BOTTOM 5
  1  T  AT&T Corp(72,674)  
  2  SBC  SBC Communications Inc(38,372)  
  3  AWE  AT&T Wireless Services Inc(7,106)  
  4  FON  Sprint Fon Group(3,418)  
  5  BRW  Broadwing Inc(1,336)  




  Number  Ticker  Company name2002  
TRANSPORTATION
TOP 5
  1  UPS  United Parcel Service Inc57,036  
  2  LUV  Southwest Airlines8,650  
  3  FDX  Fedex Corp8,558  
  4  EXPD  Expeditors Intl Wash Inc3,435  
  5  CHRW  C H Robinson Worldwide Inc2,691  
BOTTOM 5
  1  AMR  Amr Corp/De(2,763)  
  2  CSX  Csx Corp(1,431)  
  3  DAL  Delta Air Lines Inc(1,049)  
  4  UHAL  Amerco(456)  
  5  DTG  Dollar Thrifty Automotive Gp(411)  




  Number  Ticker  Company name2002  
UTILITIES
TOP 5
  1  SO  Southern Co11,817  
  2  D  Dominion Resources Inc7,897  
  3  EXC  Exelon Corp7,532  
  4  FPL  FPL Group Inc4,900  
  5  PPL  PPL Corp3,755  
BOTTOM 5
  1  RRI  Reliant Resources Inc(3,970)  
  2  EP  El Paso Corp(3,864)  
  3  MIR  Mirant Corp(3,863)  
  4  DYN  Dynegy Inc(2,695)  
  5  WMB  Williams Cos Inc(2,137)  






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