Top Fortune 500 Companies With More Than 40% Annualized EPS Growth For The Last 10 Years

by: Anh Hoang

The American economy is mostly made of the top 500 largest corporations, detailed in the Fortune 500 list. Their performances, including profitability and stock prices, have got tremendous influence in the US macro environment. Interestingly, even in the current global financial depression, many of those companies have performed very well fundamentally. Here are the top 5 companies which experienced the 10- year annualized EPS growth of more than 40%.

Cummins (NYSE:CMI). The company designs, manufactures and distributes diesel and natural gas engines, electric power generation systems and engine-related component products. Its main customers are original equipment manufacturers (OEMs) and distributors worldwide. Now in the company's network, it has more than 600 company-owned and independent distributor locations, and more than 6,000 dealer locations in more than 190 countries. Over the last 10 years, its annualized EPS growth is 59.4%, and now its diluted EPS is staying at $9.55. The company declares the cash dividends of $1.325 per share for the year 2011. CMI has the reputation of paying increasing and consistent dividends in the very long period. With the total market capitalization of $22.95 Billion, its share price is $119.55 at the time of writing. Its dividend yield is 1.1%. Since the beginning of 2012, CMI's stock price has advanced nearly 31.4%, from $91 to $119.55. Currently, the market values CMI at 14x P/E, 4.4x P/B and 13.3x its operating cash flow.

National Oilwell Varco (NYSE:NOV). It is the provider of equipment used in oil & gas drilling and production operations, oilfield services and supply chain integration services in the upstream oil & gas industry. The company operates in three business segments: Rig Technology, Petroleum Services & Supplies and Distribution Services. In the period of 2000-2010, its EPS experienced the annualized growth of 47.8%. The current share price is $82.11. With nearly 424 million shares outstanding, the market capitalization of the company is $34.8 Billion. NOV started the year 2012 with $70.8 stock price, and it has advanced nearly 16% for the last 1.5 months. Trailing twelve months, its EPS is $4.4. The multiple valuations are 18.7x P/E, 2 times its book value and nearly 15x its operating cash flow.

Sherwin-Williams (NYSE:SHW). The company is engaged in developing, manufacturing, distributing and selling paint, coatings and related products to professional, industrial, commercial and retail customers on the American continent. The business has three main segments. The Paint Stores Segment consists of 3,390 company-owned paint stores in US, Canada, Puerto Rico, Virgin Islands. The Consumer Group manufactures and sells different kinds of paint, coatings to third party customers in the US and Canada. The third segment, Global Finishes Group, licenses and sells a range of architectural paint and coatings, industrial and marine, automotive finishes and refinish products. Its EPS 10 year annualized growth reached 45.4% in the period of 2000-2010. Trailing twelve months, it earns $4.69 per share. At the beginning of this year 2012, SHW traded at $91 per share, and it closed at $98.48 at the time of writing, with the increase of 8.22%. With the share price of $98.48, the market capitalization is $10.22 Billion. SHW has been paying consistently increasing dividends for the last 30 years. And in 2011, it paid out $1.48 dividend per share, thus the current dividend yield is 1.53%. The current share price values SHW at 21x its earnings, 7x its book value and 15.6x its operating cash flow.

Biogen Idec (NASDAQ:BIIB). This is the global biotech company focusing on discovering, developing and manufacturing products for the treatment of neurological disorders and other serious diseases. The stock has experienced the significant increase since June 2010, when its stock price was around $46 per share. Now the price is $121.56 per share, creating the advance of 164% since June 2010 and of 10.5% year to date. With nearly 240 million shares outstanding, the total market capitalization is $29 Billion. In 2011, BIIB earned $5.04 per share. The long term annualized growth in EPS of the company reaches 44.4%. Currently, the market values BIIB at 24.1x P/E, 4.5x P/B and 17.2 P/CF.

AGCO (NYSE:AGCO). It is the manufacturer and distributor of agricultural equipment and related replacement parts including tractors, combines, self-propelled sprayers, hay tools and a line of diesel engines. The business has four main geographical segments: North America, South America, Europe/Africa/Middle East and Rest of World. AGCO started the year 2012 at around $44 per share. And at the current price of $52.44 per share, the stock has advanced more than 19%. Trailing Twelve months, it earned up to $3.92 per share. In the Fortune 500 list, it ranks number 05 in terms of annualized EPS growth, of 43.9% in the period of 2000-2010. Currently, AGCO is valued at 13.4x earnings, 1.8x its book value and 7.3x operating cash flow.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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