The flip side to shareholder-friendly stocks expected to
underperform the market?
Highfliers that pay little heedto their owners'
interests. Conversely, there are top-flight companies that
also treat their shareholders with respect.
Institutional Shareholder Services -- the big name in
corporate proxies -- measures how well a company performs in
as many as 63 categories covering four broad areas. Moreover,
each company is scored relative to its market index and its
industry group. It assigns the stocks a rating that it calls
its corporate governance quotient, or CGQ.
Some evidence supports the notion that companies with
weaker governance have higher risk, decreased profitability,
and lower valuations. We'll be looking at stocks
thatÂ
Motley Fool CAPSinvestors have marked to outperform the
market and that also sport above-average CGQ scores, either
in their index group or among industry peers.
Company
CAPS Rating
(out of 5)
Index CGQ Ranking*
Industry CGQ Ranking*
Automatic Data Processing (NYSE:
ADP)
****
76.4%
97.6%
Dynegy (NYSE: DYN)
****
50.9%
63.1%
Manitowoc (NYSE: MTW)
*****
89%
76.6%
Mosaic (NYSE: MOS)
****
68.7%
54.1%
USEC (NYSE: USU) Continued... |