The top 50 CEOs delivered an average total shareholder return of 73.3% since June 2007, according to a new study published by “Chief Executive” magazine and calculated by Applied Finance Group. That performance handily beats the 14.9% average of the S&P 500 during the same period.
Priceline CEO Jeff Boyd took the spot as the #1 value creator based on the success he has had in taking his company’s online travel services to international markets, expanding market share and growing the top line — while keeping tight controls on costs. Apple CEO Steve Jobs ranks number four on the list.
Others in the top 10 are: Aflac’s Daniel P. Amos (#2), Federated Investors’ J. Christopher Donahue (#3), Amazon’s Jeffrey P. Bezos (#5), Colgate-Palmolive’s Ian M. Cook (#6), Ecolab’s Douglas M. Baker Jr. (#7), DeVry’s Daniel Hamburger (#8), Fastenal’s William D. Oberton (#9) and C.H. Robinson Worldwides’s John P. Wiehoff (#10).
“The past 12 months have not been an easy time to grow – or for companies that already had high levels of ‘economic margin,’ which is profit in excess of their risk-adjusted cost of capital,” says Drew Morris, CEO of Great Numbers!, who contributed to the study. “The more profitable a company is, the more difficult it is to maintain high levels of profitability when competitors step up and target market leaders.”
Similarly, the regulatory environment can make it difficult for companies to maneuver. Both financial and healthcare companies have become the worst-performing sectors over the last 12 months, leading even well-managed organizations to struggle to maintain past success. MasterCard, which led the rankings last year, for example, slipped to No. 24 — a still-respectable score. Federated Investors, however, has consistently stayed in the top three since the value creation index was conceived three years ago.
The CEO Wealth Creation Index also lists the top wealth destroyers. The leaders of this dubious distinction include: Gregg Engles, CEO, Dean Foods; Thomas Ryan, CEO, CVS Caremark; Irene Rosenfeld, CEO, Kraft Foods; Paul Evanson, CEO, Allegheny Energy; and Myron Ullman, III, CEO, J.C. Penney. Other “value destroyers” include the CEOs of Computer Sciences, Dow Chemical and the “Washington Post.” For complete rankings and methodology, go to http://ChiefExecutive.net/WealthCreators .