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Baldrige Stock Study 2001


Results of 1990-1999 Baldrige Award Recipients 10-Year Common Stock Comparison

Methodology:

A hypothetical sum was invested in each of the 1990-1999, publicly-traded Baldrige Award recipient's common stock, in the year they applied for the Award. The investment was tracked from the first business day of the month following the announcement of the Award recipients, (or the date when they began public trading, if it is later) through December 1, 2000. $1,000 was invested in each whole company, and for subsidiaries the sum invested was $1,000 multiplied by the percent of the whole company's employee base the subunit represented at the time of its application. The same total dollar amount was invested in the Standard & Poor's (S&P) 500 on the same day. If a subunit was sold to another parent company, or if a company divested or merged, it was the subunit whose progress was followed, not the parent company's progress. The value of the original stock at the time of sale was determined and that dollar amount was reinvested in the new parent company.Adjusting for stock splits, the value on December 1, 2000 was calculated. Information is reported two ways: all publicly-traded Award recipients and only whole company Baldrige Award recipients. The 24 publicly-traded Award recipients, as a group, outperformed the S&P 500 by approximately 4.2 to 1, achieving a 685.26% return compared to a 163.11% return for the S&P 500. The group of five, publicly traded, whole company Award recipients outperformed the S&P 500 by 4.4 to 1, achieving a 764.84% return compared to a 173.34% return for the S&P 500. A summary of the results follows.

1990 - 1999 Publicly Traded Award Recipients

  $ Investment $ Value - 12/1/00 Change
1990-1999 Award Recipients 7,282.35 57,185.19 685.26%
S&P 500

7,282.35

19,160.33 163.11%


1990 - 1999 Publicly Traded Whole Company Award Recipients

  $ Investment $ Value - 12/1/00 Change
1990-1999 Whole Company Award Recipients 5000 43,241.93 764.84%
S&P 500

5000

13,667.22

173.34%


Results of 1990-1999 Baldrige Site Visited Applicants10-Year Common Stock Comparison

Methodology:

A hypothetical sum was invested in each 1990-1999 publicly-traded, site visited applicant's common stock in the year they applied for the Award or in the year they became public. (The site visited applicant group includes Baldrige Award recipients.) The investment was tracked from the first business day of the month following the announcement of the Baldrige Award recipients (or the date when they began public trading, if it is later) through December 1, 2000. $1,000 was invested in each whole site visited company. For subsidiaries, the sum invested was $1,000 x the percent of the parent company's employee base the subunit represented at the time they received a site visit or at the time they became public as a result of a merger or acquisition by a new parent. The same total dollar amount was invested in the S&P 500 on the same day.

Adjusting for stock splits, the value on December 1, 2000 was calculated. Information is reported two ways: all publicly-traded site visited applicants and only whole company site visited applicants. (Note: a company may be included multiple times if they received more than one site visit. Site visited applicants include those receiving an Award.)

The 70 publicly-traded site visited applicants, as a group, outperformed the S&P 500 by approximately 2.1 to 1 achieving a 321.80% return compared to a 153.54% return for the S&P 500. The group of 13 whole company site visited applicants outperformed the S&P 500 by almost 2 to 1, achieving a 312.39% return compared to a 158.12% return for the S&P 500. Names of Baldrige applicants are kept confidential. A summary of the results follows.

[NOTE: In the future, NIST will no longer include site-visited applicants in this study. ]

1990 - 1999 Publicly Traded Site Visited Award Applicants

  $ Investment $ Value - 12/1/00 Change
1990-1999 Site Visit Applicants 23,537.43 99,280.06 321.80%
S&P 500

23,537.42

59,676.37 153.54%


1990 - 1999 Publicly Traded Whole Company Site Visited Award Applicants

  $ Investment $ Value - 12/1/00 Change
1990-1999 Whole Company Site Visited Applicants 13000 53,610.91 312.39%
S&P 500

13000

33,555.82 158.12%


AWARD RECIPIENTS INCLUDED IN THE STOCK STUDY
(Those not included were not publicly held at the time of the study)

Whole Company Award Recipients
ADAC Laboratories (1996)
Eastman Chemical Company (1993)
Federal Express Corporation (1990)
Solectron Corporation (1991 and 1997)

Subunit Award Recipients (with parent company)
(The sum invested was $1000 x the % of the parent company's employee base that the subunit represented at the time the subunit applied.)*

3M Dental Products Division (1997)
3M

Armstrong Building Products Operations (1995)
Armstrong World Industries, Inc.

AT&T Consumer Communication Services (1994)
Consumer Markets Division of AT&T

AT&T Network Systems - Transmission Systems Business Unit (1992)
Lucent Technologies, Inc., Network Systems

AT&T Universal Card Services (1992)
Citigroup, Inc.

Boeing Airlift and Tanker Programs (1998)
The Boeing Company

Cadillac Motor Car Company (1990)
General Motors

Corning Telecommunications Products Division (1995)
Corning Incorporated

Dana Commercial Credit Corporation (1996)
Dana Corporation

GTE Directories Corporation (1994)
GTE Corporation

IBM Rochester, AS/400 Division (1990)
IBM Corporation

Merrill Lynch Credit Corporation (1997)
Merrill Lynch & Co.

Solar Turbines Incorporated (1998)
Caterpillar Inc.

STMicroelectronics, Inc. - Region Americas (1999)
STMicroelectronics, Inc.

Texas Instruments Incorporated - Defense Systems & Electronics Group (1992)
Raytheon Company

The Ritz Carlton Hotel Company (1992, first included in 1997 study and 1999)Marriott International
*(Ritz Carlton became public when Marriott International acquired it. The sum invested was based on the sum of Marriott's employee base.)

Xerox Business Services (1997)
Xerox Corporation

Zytec Corporation (1991)
Artesyn Technologies
*(As of 12/29/97 Zytec Corporation merged with Computer Products and formed Artesyn Technologies. Dollars invested in Zytec were carried forward into Atesyn with a 1.33 split multiplier.)

NIST 2000 Stock Study of Malcolm Baldrige National Quality Award Recipients

Date of Investment

Whole Company Recipient or Parent (Subsidiary Recipient)

Stock Purchases
Price

Stock Purchases
$ Invested

December 1, 2000 Close

 Price  $ Value % Change

11/1/90

General Motors (Cadillac Motor Car Division)

36.875

13.39

50.31

18.27

36.43

11/1/90

Federal Express Corporation

33.375

1000.00

47.48

5690.49

469.05

11/1/90

IBM (IBM Rochester)

107.25

17.62

95.63

62.84

256.66

11/1/91

Solectron

28.25

1000.00

29.00

32849.56

3184.96

11/2/92

CitiGroup (AT&T Universal Card Services)

44.125

6.53

48.94

53.19

714.59

11/2/92

Lucent (AT&T Transmission Systems Business Unit)

44.125

37.54

15.69

78.12

108.09

11/2/92

Raytheon (Texas Instruments DSEG)

49.375

246.61

29.81

531.29

115.44

11/11/93

Artesyn (Zytec)

10.5

1000.00

35.75

12150.56

1115.06

1/3/94

Eastman Chemical

45.125

1000.00

44.38

983.49

-1.65

11/1/94

AT&T (AT&T Consumer Communications Services)

54.5

159.26

19.56

110.13

-30.85

11/1/94

GTE (GTE Directories)

30.5

41.88

56.06

103.25

146.54

11/1/95

Armstrong World Industries (Building Products Operations

58.875

118.25

1.00

2.01

-98.30

11/1/95

Corning Incorporated (Corning TPD)

25.75

36.41

60.94

302.17

729.91

11/1/96

ADAC Laboratories

20.875

1000.00

18.38

880.48

-11.95

11/1/96

Dana (Commercial Credit)

29.875

11.27

17.25

6.51

-42.26

11/3/97

3M (Dental Products Division)

92.1875

9.90

99.63

10.70

8.07

11/3/97

Merrill Lynch (Credit)

69.75

16.51

58.44

27.66

67.57

11/3/97

Solectron

40.875

1000.00

29.00

2837.92

183.79

11/3/97

Xerox (Business Services)

79.875

149.54

6.25

23.40

-84.35

3/30/98

Marriott (The Ritz Carlton Hotel, 1992 recipient )

35.94

96.53

41.88

112.49

16.54

12/1/98

Boeing (Airlift & Tanker Programs)

40.375

36.91

65.81

60.17

63.00

12/1/98

Solar Turbines, Inc.

51.94

95.16

40.69

74.55

-21.66

12/1/99

Marriott (The Ritz Carlton Hotel )

33.125

96.52

41.88

122.04

26.43

12/1/99

STMicroelectronics, Inc.

125.4375

92.52

42.44

93.91

1.50

Totals

Baldrige Award Recipients S&P 500

 7282.35

7282.35

 

57,185.19
19,160.33

685.26
163.11