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Finding growth stocks isn’t difficult. What’s difficult is finding growth stocks that don’t fade and are built to outpace their rivals. To identify firms that have proven and sustainable businesses with a pipeline of innovative ideas, FORBES created its list of America’s Fastest Growing Tech Companies, now in its 11th year. We sift through more than 2,100 publicly traded tech firms, selecting only profitable outfits with a minimum revenue of $150 million and a market cap of at least $500 million. List membership requires sales growth of at least 10% for each of the past three fiscal years and over the last 12 months, as well as estimated earnings growth above 10% over the next three to five years. We then rank the list by three-year average sales growth rate
Most innovation rankings are popularity contests based on past performance or editorial whims. We set out to create something very different with the World’s Most Innovative Companies list, using the wisdom of the crowd. Our method relies on investors’ ability to identify firms they expect to be innovative now and in the future.
2018 is the 32nd year publishing the Forbes Billionaires list. The Forbes Billionaires list is a snapshot of wealth taken on 2018, when stock prices and exchange rates were locked in from around the world. It lists individuals rather than multigenerational families who share large fortunes. In some cases siblings and couples are listed together if the ownership breakdown among them isn’t clear; however, they still must be worth on average a minimum of $1 billion apiece to make the cut. To compile net worths, individuals’ assets – including stakes in public and private companies, real estate, yachts, art and cash – are valued and estimates of debt are taken into account. Royal family members or dictators who derive their fortunes entirely as a result of their position of power as well as royalty who, often with large families, control the riches in trust for their nation are not included.
Forbes valued the brands on three years of earnings and allocated a percentage of those earnings based on the role brands play in each industry (e.g., high for luxury goods and beverages, low for airlines and oil companies). The average price-to-earnings multiple over the past three years was applied to these earnings to arrive at the final brand value.
A universe of more than 200 global brands was a starting point. Brands were required to have more than a token presence in the U.S., which eliminated some big brands like multinational telecom firm Vodafone and Chinese e-commerce giant Alibaba.
The first step in valuing the brands was to determine revenue and earnings before interest and taxes for each brand. We gathered these from company reports, Wall Street research and industry experts. A tip of the cap to Euromonitor, who provided retail sales figures for certain product brands. Forbes averaged earnings before interest and taxes (EBIT) over the past three years and subtracted from earnings a charge of 8% of the brand’s capital employed, figuring a generic brand should be able to earn at least 8% on this capital.
Forbes applied the maximum corporate tax rate in the parent company’s home country to that net earnings figure. Next, a percentage of those earnings was allocated to the brand based on the role brands play in each industry. (Brands are crucial when it comes to beverages and luxury goods, but less so with airlines, when price and convenience are more important.)
To this net brand earnings number, the average price-to-earnings multiple was applied over the past three years to arrive at the final brand value. For privately held outfits an earnings multiple for a comparable public company was applied. Brands are all in U.S. dollars and converted at April 25 exchange rates.
The 100 most valuable brands span 16 countries and cross 19 broad industry categories.
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