BrandFinance computed brand value for companies around the world, and then compiled a list of the top 500 brands in the world.Because the top 10 names trade on the NYSE or NASDAQ, we thought it would be worth it to take look, and see how these names may do in 2011.
No. 1 Google (GOOG) - Has a brand value of $44.29 billion. Google went up from No. 2 in 2010.
In 2010, revenues jumped by 23.9% to $29.32 billion, net income went up by 30.4% to $8.5 billion, and GAAP EPS grew by 28.9% to $26.31. The EBT margin was fat with 36.82%. In 2011, the Street estimates non GAAP EPS to be between $32.23 and $37.51. In 2010, non GAAP EPS was $29.60.
Q1 2011 results are released on April 15. Analysts expect between $7.58 (+12%) and $8.79 (30%). In Q1 2010, the actual non GAAP EPS was $6.76. Google has exceeded consensus estimates in eight of the last nine quarters. GOOG shares trade with a price to sales multiple of 6.5. From 2004 to 2007, those multiples were 16.5, 19.4, 13.3 and 16.5, respectively. Google has little to no debt on its books. These shares have the fundamentals to run up if Google can continue to grow EPS aggressively (25%-plus). Yahoo (YHOO) is ranked #136 with a brand value of $6.8 billion. It jumped from #168 in 2010.
No. 2 MSFT (MSFT) - Has a brand value of $42.8 billion. It jumped up from No. 5 in 2010.
In FY 2010 through June, Microsoft had $62.48 billion in revenues, which was +6.93%, after dropping 3.28% in FY 2009. The EBT margin also improved to 40.03% from 33.92%. GAAP/non GAAP EPS came in at $2.10, which was +29.63%, after -13.37% in FY 2009.
In FY 2011, the Street expects non GAAP EPS to be between $2.40 (+14.2%) and $2.64 (+25.7%). Thus far, Q1 and Q2 2011 have produced a combined non GAAP EPS of $1.39 compared to $1.14 for the same period in FY 2010. Q3 2011 is expected to post between $0.49 and $0.61 in non GAAP EPS. In comparison, Q3 2010 posted $0.45. Microsoft reaffirms operating expense guidance of $26.9 billion to $27.3 billion for the full year ending June 30, 2011.
MSFT shares currently trade with a P/S of 3.4. From 2003 to 2007, the multiples were 8.7, 7.6, 6.9, 6.7 and 5.9, respectively. The company has a debt to equity ratio of 0.20. The company is sound enough for its shares to appreciate handsomely, given double digit revenues growth and consistent EPS growth of 15%+. Guru investors David Tepper and David Einhorn are also shareholders. Cisco (CSCO) is ranked #71 with a brand value of $11.66 billion.
No. 3 Wal-Mart (WMT) - Has a brand value of $36.22 billion. Wal-Mart fell from No. 1 in 2010.
In FY 2011 through January, Wal-Mart made $421.8 billion in revenues, which was an increase of 3.4%, after +0.64% in FY 2010. The EBT margin improved to 5.61% from 5.41% in FY 2009. GAAP EPS rose by 12% to $4.18, after +9.14% in FY 2009.
For FY 2012, analysts expect non GAAP EPS between $4.33 (+6.3%) and $4.57 (+12.2%), and the company gave guidance within the range from $4.35 (6.8%) and $4.50 (+10.5%). The figure for FY 2011 was $4.07. The next earnings release is on May 17. Analysts expect between $0.90 and $1.00, and the company expects between $0.91 and $0.96. In comparison, Q1 2011 produced an EPS of $0.87. WMT shares trade with a P/S of 0.5. Since 2006, shares have traded between multiples of 0.5 and 0.6. The company has a manageable debt to equity ratio of 0.67.The groundwork is laid for WMT, but it has to have a breakout higher from its current EPS and revenues growth. Target (TGT) is ranked #45 with a brand value of $15.98 billion. It fell 11 spots from #34 in 2009.
No. 4 IBM (IBM) - Has a brand value of $36.15 billion, and stands pat from its 2010 ranking.
In 2010, the company grew revenues by 4.3% to $99.87 billion, after falling by 7.6% in 2009. The EBT margin also improved to 19.75% from 18.94%. GAAP/non GAAP EPS went up by 15.08% to $11.52, after +12.09% in 2009.
In 2011,analysts expect non GAAP EPS between $12.95 (+12.4%) and $13.22 (+14.7%). IBM said that it expects to deliver full-year 2011 GAAP earnings per share of at least $12.56 (9.0%). For Q1 2011, analysts expect between $2.19 and $2.37. In comparison, Q1 2010 produced a non GAAP EPS of $1.97. The next report date is April 18. IBM shares trade with a P/S of 2.1. This is the highest multiple since 2001, when it had a P/S of 2.5. The company has a debt to equity ratio of 0.95. If IBM hits analyst targets this year, expect significant appreciation. Dell (DELL) is ranked #77 with a brand value of $10.98 billion. Also, Intel (INTC) is ranked #27 with a brand value of $19.07 billion.
No. 5 Vodafone (VOD) - Has a brand value of $30.67 billion. In 2010, it was ranked No. 7.
In FY 2010 through March, the company grew revenues by 8.42% to $44.47 billion GBP ($71.34 billion), after rising by +15.86% in FY 2009. EBT margins also improved to 19.5% from 10.21%. EPS grew by 181.58% to 1.64 GBP ($2.63), after falling by 53.52%.
The company expects operating profit to be toward the upper end of the 11.8 to 12.2 billion GBP range ($18.93 billion to $19.57 billion) that was communicated in November. In FY 2010, operating profit was 9.48 billion GBP ($15.2 billion), which was +61.86%, after -41.58% in FY 2009.
Through Q3 2011, revenues are up 3.57%. The company reports FY 2011 results on May 17. VOD shares trade with a P/S of 2.1. The best multiples were from 2002 to 2006 with multiples near 3. The company has a debt to equity ratio of 0.35. We expect VOD to continue to trade 2.0-2.2 times sales per share for the rest of FY 2011. China Mobile (CHL) is ranked #25 with a brand value of $19.31 billion. T-Mobile is ranked #72 with a brand value of $11.55 billion.
No. 6 Bank of America (BAC) - Has a brand value of $30.61 billion. It climbed 6 spots from No. 12 in 2010.
In 2010, the company generated $110.22 billion in revenues, which was a drop of 7.88%, after climbing by 64.39% in 2009. GAAP EPS came in at - $0.37 in 2010, after showing - $0.27 in 2009.
In 2011, the Street expects non GAAP EPS to be within a range from $1.05 (+22%) to $1.75 (+103.4%). In 2010, the figure was $0.86. Analysts expect Q1 2011 non GAAP EPS between $0.15 and $0.44. Q1 2010 non GAAP EPS was $0.28. The company reports Q1 2011 results on April 11.
BAC shares trade with a price to sales multiple of 1.2. In its heyday, the multiples were in the 3s. If the Street’s lofty expectations are met, these shares may trade up to 1.5x sales because the company has a debt to equity ratio of 2.12. Citigroup (C) is ranked #36 with a brand value of $17.13 billion. Moreover, Chase is ranked #26 with a brand value of $19.15 billion. As we wrote about here, we hate Bank of America and think Warren Buffett was spot on when he dumped shares.
No. 7 General Electric (GE) - Has a brand value of $30.5 billion. It slipped one spot from No. 6 in 2010.
In 2010, this Buffett favorite made $150.21 billion in revenues, which was a drop of 4.19%, after dropping by 14.1% in 2009. GAAP/non GAAP EPS crept up by 4.95% to $1.06, after dropping by 41.28% in 2009. Also, the EBT margin improved from 6.6% to 9.46%.
In 2011, analysts expect EPS to be between $1.24 (+16.9%) and $1.38 (30.1%). Q1 2011 results come out on April 21. Analysts expect between $0.25 and $0.30. In comparison, the Q1 2010 EPS was $0.21. GE shares trade with a P/S multiple of 1.4. In the earlier part of the 2000s, these shares traded 2.0 to 2.5 times sales per share. Because the company has a debt to equity ratio of 2.47, we expect GE shares to continue to trade in the neighborhood of 1.3 to 1.5 times sales per share.
No. 8 Apple (AAPL) - Has a brand value of $29.54 billion. The company surged 12 spots from No. 20 in 2010.
In fiscal years 2010 and 2009 through September, this George Soros stock grew revenues by 52% and 32.1% to $65.22 billion and $42.90 billion, respectively. In FY 2010, the EBT margin remained strong at 28.42% from 28.12% in FY 2009. EPS was $15.15, which was +66.85%, after +69.40% in FY 2009.
In FY 2011, analysts expect EPS between $20.41 (+34.7%) and $24.17 (+59.5%). Q1 2011 already produced $6.43 versus Q1 2010’s $3.67. Q2 2011 earnings come out on April 21. The Street expects between $4.85 and $5.98. Apple expects $4.90 per share in earnings in Q2 2011. In comparison, EPS for Q2 2010 was $3.33. AAPL shares trade with a P/S multiple of 4.2. Apple’s highest P/S multiple was in 2007 with 6.7. The company has a debt to equity ratio near zero. If Apple achieves EPS growth of over 50%, AAPL should easily trade north of five times sales per share.
No. 9 Wells Fargo (WFC) - Has a brand value of $28.94 billion. The company went up 6 spots from No. 15 in 2010.
In 2010, the company made $85.21 billion in revenues, which was -3.92%, after climbing by 111.68% in 2009. The EBT margin improved to 22.3% from 20.29%. EPS was $2.21, which was +26.29%, after +150% in 2009.
In 2011, the Street expects EPS to be between $2.49 (+12.6%) and $3.75 (+69.6%). Q1 2011 results come out on April 20, when analysts expect between $0.60 and $0.81. In comparison, Q1 2010 EPS was $0.43. WFC shares trade with a P/S multiple of 2.0. In the early 2000s, it traded in the low 3s. The company has a debt to equity ratio of 1.33. If the company can put together a year with double digit growth in revenues and EPS growth above 20%, the company should trade near 2.5 times sales. We think WFC’s dividend will rebound strongly this year.
No. 10 AT&T (T) - Has a brand value of $28.88 billion. In 2010, it was ranked No. 11.
In 2010, this company drew in $124.28 billion in revenues, which was +1.03%, after -0.81% in 2009. Moreover, the EBT margin in 2010 was 14.67%, and in 2009 it was 15.44%. GAAP EPS came in at $3.35, which was +58.02%, after -1.85% in 2009.
This company has been showing new leadership in today’s market. In 2011, analysts expect non GAAP EPS between $2.26 (-1.7%) and $2.57 (+11.7%). In 2010, non GAAP EPS was $2.30. Q1 2011 results come out on April 20 with analysts expecting between $0.51 and $0.62. In comparison, EPS was $0.59 in Q1 2010. AT&T shares trade with a price to sales multiple of 1.4. From 2002 to 2007, the multiples were near 2.AT&T recently announced the purchase of T-Mobile. Sprint (S) is ranked #298 with a brand value of $3.53 billion. Good luck taking on AT&T and T-Mobile.
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