Independent competitive research firm W Ratings has published their first annual ranking of most competitive companies among U.S. consumers, using data collected since 1999. The Top 40 Most Competitive Companies report identifies the best performing companies or specific business segments through a patented method that blends financial and market data. Specifically, W Ratings measures a company’s ability to achieve higher economic profit than rivals and sustain that competitive advantage through moats, or barriers to entry, as rated by consumers.
“Today’s business environment is enormously difficult to interpret with the markets changing direction almost every day,” said Gary A. Williams, CEO & Founder of W Ratings. “Yet CEOs and shareholders need to make investments based on what will remain stable. This Top 40 list cuts through all the noise and clearly identifies those companies most likely to remain competitive because they possess both economic and consumer advantages.”
One of the world’s greatest investors, Warren Buffett, doesn’t invest in a company without a moat to protect its profits. The W Ratings approach clearly identifies the nine moats that create a durable advantage and measures them in a consistent way across every industry. Just as investors compare key financials between companies, now they can easily compare consumer advantages between sectors, industries and any individual company. The W rankings paint a clear picture of those companies performing best financially as well as meeting consumer expectations.
In 2007, Google replaces Coca-Cola as the most competitive company, but not just because of its brand. According to consumers, the Google brand is only one source of its economic and consumer advantages. Google is competitive in four of the nine moats tracked by W Ratings. Coca-Cola and Pepsi remain in the top 10, while beer brands Budweiser, Heineken and Corona have made significant strides in overall competitiveness. Specialty retailers/apparel brands Under Armour and Victoria’s Secret, covered for the first time, rank No. 5 and No. 6, respectively. Travel and leisure companies, including airlines, cruise lines, hotels and casinos, are absent from the Top 40 as they have failed to put together both a successful financial track record and meet consumer expectations consistently.
Competitiveness rankings were determined using an algorithmic formula W Ratings originally developed in 1999 and has since been utilizing to rate more than 500 companies and products familiar to domestic consumers. The Competitiveness Rating (CR) was calculated by percentile ranking companies by their average economic profit over the past five years (2001-2006) and by their current year’s (2007) total moat score and weighting those rankings equally into one score. Economic profit is defined as a company’s return on invested capital in excess of the companies weighted average cost of capital. Total moat score is derived from a quantitative consumer interview database and is defined as the sum of nine areas of competitive advantage with each area, or moat, measuring between negative one and five. The more moats and higher total moat score indicate a higher likelihood of sustaining a competitive advantage with consumers. To be considered in the Top 40 list, companies must have either a dominant market share or wide recognition among the general U.S. population and have publicly available financial data. Sectors surveyed comprise retail and consumer goods, media content, communications, financial services, travel & leisure and restaurant & beverage.
For a limited period of time, W Ratings is releasing a complimentary version of the Top 40 Most Competitive Companies in 2007 at www.wratings.com.
TOP 40 RANKINGS | ||||||||||
| TOTAL MOAT | 5-YR ECONOMIC | |||||||||
| RANK | COMPANY | TICKER | SECTOR | SCORE | PROFIT | |||||
| IN 2007 | (2001-2006) | |||||||||
| 1 | Google Search | GOOG | Media Content | 22 | 21.9% | |||||
| 2 | Budweiser / Bud Light | BUD | Restaurant / Beverage | 27 | 15.5% | |||||
| 3 | Coke / Diet Coke | KO | Restaurant / Beverage | 21 | 18.3% | |||||
| 4 | Food Network | SSP | Media Content | 23 | 14.5% | |||||
| 5 | Under Armour | UA | Retail / Consumer Goods | 18 | 22.4% | |||||
| 6 | Victoria’s Secret | LTD | Retail / Consumer Goods | 23 | 9.3% | |||||
| 7 | Pepsi / Diet Pepsi | PEP | Restaurant / Beverage | 18 | 13.3% | |||||
| 8 | Bed Bath & Beyond | BBBY | Retail / Consumer Goods | 18 | 12.4% | |||||
| 9 | Ruth’s Chris Steakhouse | RUTH | Restaurant / Beverage | 18 | 11.9% | |||||
| 10 | Nokia | NOK | Communications | 15 | 56.8% | |||||
| 10 | Cracker Barrel | CBRL | Restaurant / Beverage | 23 | 7.0% | |||||
| 10 | Heineken | Foreign | Restaurant / Beverage | 21 | 7.4% | |||||
| 13 | Corona / Corona Light | Foreign | Restaurant / Beverage | 28 | 5.5% | |||||
| 14 | The UPS Store | UPS | Retail / Consumer Goods | 16 | 12.6% | |||||
| 15 | Ross Stores | ROST | Retail / Consumer Goods | 15 | 17.3% | |||||
| 16 | Comerica | CMA | Financial Services | 22 | 5.9% | |||||
| 17 | Progressive Insurance | PGR | Financial Services | 16 | 11.4% | |||||
| 18 | Chico’s FAS | CHS | Retail / Consumer Goods | 17 | 8.7% | |||||
| 19 | Taco Bell | YUM | Restaurant / Beverage | 15 | 16.2% | |||||
| 20 | Mountain Dew / Diet Mountain Dew | PEP | Restaurant / Beverage | 15 | 13.3% | |||||
| 21 | Aflac Insurance | AFL | Financial Services | 18 | 7.1% | |||||
| 22 | Animal Planet Channel | DISCA | Media Content | 24 | 4.7% | |||||
| 23 | CVS | CVS | Retail / Consumer Goods | 20 | 5.5% | |||||
| 24 | Gymboree | GYMB | Retail / Consumer Goods | 16 | 8.7% | |||||
| 25 | Goldman Sachs Investments | GS | Financial Services | 16 | 8.2% | |||||
| 26 | HGTV Channel | SSP | Media Content | 14 | 14.5% | |||||
| 27 | California Pizza Kitchen | CPKI | Restaurant / Beverage | 18 | 6.2% | |||||
| 28 | YouTube | GOOG | Media Content | 13 | 21.9% | |||||
| 29 | DHL Service Stores | Foreign | Retail / Consumer Goods | 15 | 10.3% | |||||
| 30 | Fidelity National Financial Insurance | FNF | Financial Services | 19 | 5.0% | |||||
| 30 | Amstel Light | Foreign | Restaurant / Beverage | 16 | 7.4% | |||||
| 32 | UBS Investments | UBS | Financial Services | 13 | 18.4% | |||||
| 33 | Sam Adams / Sam Adams Light | SAM | Restaurant / Beverage | 15 | 8.8% | |||||
| 34 | Carter's | CRI | Retail / Consumer Goods | 21 | 4.1% | |||||
| 35 | NIKETOWN | NKE | Retail / Consumer Goods | 14 | 10.4% | |||||
| 36 | Home Depot | HD | Retail / Consumer Goods | 16 | 6.6% | |||||
| 37 | Discovery Channel | DISCA | Media Content | 19 | 4.7% | |||||
| 38 | Outback Steakhouse | OSI | Restaurant / Beverage | 18 | 4.8% | |||||
| 39 | Banana Republic | GPS | Retail / Consumer Goods | 22 | 2.6% | |||||
| 40 | Longhorn Steakhouse | DRI | Restaurant / Beverage | 19 | 3.9% | |||||
ABOUT W RATINGS CORPORATION
W Ratings, an independent competitive research firm based in metro Washington DC, identifies companies “winning” with both consumers and shareholders by utilizing patented research methods. Gary A. Williams, CEO & Founder, and his team have been conducting primary research on an original set of leading indicators that measure competitive advantage since 1999. Through Gary’s patented research system, the team measures how well companies are delivering on consumer expectations and then correlate their performance with economic profits. Gary and his team continually analyze 500+ market leading companies with 25+ million data points collected using his common framework. The research provides CEOs, senior executives and shareholders a universal way to evaluate the spending needs of company to ensure they are building a durable competitive advantage.
Contacts:
Dan Lowrey
703-673-2895 or 703-788-6532
pr@wratings.com
