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IESE Research Papers,
IESE Business School

No D/580: Shareholder value creators in the S&P 500: Year 2004

Pablo Fernandez () and Alvaro Villanueva
Additional contact information
Pablo Fernandez: IESE Business School, Postal: Research Division, Av Pearson 21, 08034 Barcelona, SPAIN
Alvaro Villanueva: IESE Business School, Postal: Research Division, Av Pearson 21, 08034 Barcelona, SPAIN

Abstract: During 2004, 64% of the companies in the S&P 500 created value, while in 2003 the figure was 87%. The market value of the 500 companies was $11.2 trillion in 2004, compared to $10.1 trillion in 2003. The top shareholder value creators in 2004 were Exxon, General Electric, Ebay, Johnson & Johnson and Qualcomm. We define created shareholder value and provide the ranking of created shareholder value for the 500 companies. We also calculate the created shareholder value of the 500 companies during the twelve-year period 1993-2004. General Electric was the top shareholder value creator and AT&T was the top shareholder value destroyer during the twelve-year period. On average, the small market capitalization companies of the S&P were more profitable. Between 1998 and 2004, the volatility of the S&P as a whole fell, but the volatility of its components increased on the average.

Keywords: shareholder value creation; created shareholder value; equity market value; shareholder value added; shareholder return; required return to equity

JEL-codes: G12; G31; M21

33 pages, February 14, 2005

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DI-0580-E.pdf PDF-file

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