Is Women CEO the Secret to Generating High Returns on Equity?
There are a number of women breaking the glass ceiling in the business world. Some have reached the coveted CEO level and oversee great companies with large market capitalizations. These female CEOs can be found in a wide variety of sectors.
These companies have been celebrated for having strong management and good foresight. According to an article on The Balance and a number of studies in recent years, there is evidence that women in executive positions and on corporate boards can have a positive impact on a company’s performance.
Here are the best-run companies listed on Stockchase run by CEOs that are women:
Linamar Corp (LNR-T)
Linda Hasenfratz is a Canadian businesswoman, the president, chairman, and CEO of Linamar since 2002. The second largest automobile parts manufacturer. It’s a very well managed company with products to go forward. They are also in the aerial lifts and agriculture space.
(A Top Pick Apr 05/22, Up 22%) Key driver: a company less impacted by supply constraints around the world, particularly Europe. That's why he bought it. However, they could suffer if there's a deep recession in 2023. Fundamentals remain rock solid. Will emerge strong after a recession, if it happens.
General Motors Corporation (GM-N)
Mary Teresa Barra is the Chairwoman and CEO of General Motors Company, and she has held the CEO position since 2014. It’s trading at a cheap multiple of 6.2x earnings. There is volatility in the auto sector as they go through electrification. It pays a good dividend but it is not expected to be raised in the near future.
Seeing signs of a base forming on the price of shares. Good time to buy. Shift to electric vehicles will be good for the business. Expecting higher prices for the stock.
Hershy Foods Corp (HSY-N)
Michele Buck is an American businesswoman. In March 2017,she became the first female President and CEO. The largest chocolate manufacturer in the world. It is a global leader with over 80 brands. A defensive growth stock and it is a good pick against tariffs since most of their revenues are from North America.
Ulta Salon Cosmetics and Fragrance Inc. (ULTA-Q)
Mary Dillon is an American businesswoman, and has been the CEO since July 2013. A beauty store chain in the United States. It’s well managed and is continuing to open stores. Their same-store sales growth has been growing well at 7-8% yearly.
Last week they reported a giant earnings beat and nearly 15% same-store sales growth. They were up against really tough comps. Management also raised their forecast, but the market didn't care and sold down shares by 5% after that report. However, shares ran up during that quarter, and management warned of a competitive holiday season.
Ross Stores Inc. (ROST-Q)
Barbara Rentler is a businesswoman, and the current CEO of Fortune 500 company. An off-price department store chain. They are the second largest after TJX Companies. In times of recession, these stocks tend to do well. THey are also building stores and buying back shares.
She also owns American Eagle Outfitters and Foot Locker in the retail space. Ross is actually up only 1% year to date, but up 40% in the past month. AEO is -40% YTD, up 50% in the last month, and Foot Locker is 15% YTD and 15% past month. The theme for all these--and why…
Advanced Micro Devices (AMD-Q)
Lisa Su is a Taiwanese American business executive and electrical engineer, and the CEO and president of Advanced Micro Devices (AMD). A semiconductor maker that is Intel’s competitor. It has stayed above the 200 day average and the sector is recovering.
It reports next week and she hopes it will be decent. They may face question on oversupply. Sees this as a multi-year play as she expects AMD to take further market share from Intel.
Safra A. Catz is an Israeli-born American business executive and co-CEO of Oracle Corporation. A computer technology company. They are developing their subscription services and cloud based business.
He bought more today. Cloud provider for TikTok, a massively growing company. Lots of horses in the race, from hardware to software to services to the cloud. Lots of traction, especially on the cloud. Yield is 2.03%. (Analysts’ price target is $85.00)
Virginia Marie “Ginni” Rometty is an American business executive. She is the current chair, president, and CEO of IBM, and the first woman to head the company. A multinational tech company that specializes in computer hardware. They are implementing a stock buyback plan that will see the stock pay a 5% yield.
Among the worst Dow performers in Q3 Down nearly 16%. Pays a 5.6% yield. They spun off their slow-growing services business and double-downed as a hybrid cloud analytics platform. But if Wall Street expects all cloud will slow, IBM will get hurt. He disagrees that the cloud will slow. IBM has a ton of cash…
Mylan Inc (MYL-Q)
Heather Bresch is an American business executive. She has served as the chief executive officer (CEO) of Mylan since 2012. A global pharmaceutical company that manufactures generic drugs. They are the ones who manufacturer EpiPen and they went through some controversy. A generic version is now offered but their credibility is still brining pressure.
TEVA-N vs. MYL-Q. He does not like either at these prices. They are both generics manufacturers. There are lots of headwinds on pricing in these categories. We have had a lot of noise on pricing of pharmaceuticals. The FDA is going to alleviate the delays on getting new drugs to market. He wants to be…
Ventas Inc (VTR-N)
Debra A. Cafaro is an American business executive, who is Chairman of the Board and Chief Executive Officer of Ventas, Inc. A real estate investment trust specializing in the US healthcare industry. They are one of the largest healthcare REITs and is very well run.
In assisted living, he would buy Ventas, but too many things can go wrong with this entire sector due to Omicron, so he wouldn't touch the sector right now.
Nasdaq Stock Market (NDAQ-Q)
Adena T. Friedman is an American businessperson. She currently serves as the president and CEO of Nasdaq. The financial services company that operates the NASDAQ stock exchange. They also operate eight European stock exchanges.
(A Top Pick Jul 14/21, Down 9%) It has a wide moat with very few competitors. They invest a lot in data analytics and tech. 55% recurring revenues.
Progressive Corp Ohio (PGR-N)
Tricia Griffith is an American business executive who currently serves as the CEO and president of Progressive. A car insurance provider. The property and casualty insurance sector has very low costs of operation and is profitable. There is a long-term uptrend that is lifting share prices.
Very fine company. One of the best property and casualty companies in the world. Relatively resilient, defensive business model. Long-term, he recommends it. But for short and medium performance, we're exiting a recession, so it makes sense to put more capital into cyclicals.
Synchrony Financial (SYF-N)
Margaret Keane has been the chief executive officer and president of Synchrony Financial since February 2014. A consumer financial services company. They try to bring value to consumers and merchants. It offers private label credit cards and other deposit products.
A financial stock, and he likes financials. It has done very well. Closed at $39.76, and he has a model price of $49.45, 25% higher. Pays out $.60. Looks like they are going to earn $3.46 this year.
Beth Elaine Mooney is an American financial executive who is the first woman to be CEO of a top-20 U.S. bank. A regional bank based in Cleveland. It is one of the largest bank-based financial services company.
(A Top Pick Aug 22/16. Up 54.49%.) A small-cap bank. If you are risk averse, he would advise you to get out of the stock. If not, the story is still good. Thinks there is still some upside, especially if interest rates go up.
Transalta Corp (TA-T)
Dawn Lorraine Farrell has been the Chief Executive Officer and President at TransAlta Corporation since 2012. An electricity power generator that has announced plans to buy back stocks. They are making a transition from coal to natural gas fired power plants.
3x book value. It got there by buying back stock, thereby trashing its balance sheet. By paying out equity, they've raised ROE and pushed up price to book. It's a technical move, as opposed to positive fundamentals.
Atco Ltd (ACO.X-T)
Nancy C. Southern has been the Chief Executive Officer of ATCO Ltd. since January 2000. A holding company with subsidiaries mostly in gas or construction. The talks of lower interest rates has helped this company’s stock price.
Stockchase Research Editor: Michael O'Reilly WE reiterate this Canadian infrastructure utility as a TOP PICK. It has entered into an agreement with CP to provide construction services for two hydrogen production and refueling facilities in Alberta. It trades at 1.1x book and at 12x earnings. It has a good dividend, which has grown by 7%…
Duke Energy (DUK-N)
Lynn J. Good is chairman of the board, president and chief executive officer of Duke Energy, a Fortune 500 company. An electric power holding company that is in energy infrastructure. The rising interest rate have hurt the utilities and energy sector but it is recovering and the overall outlook is good.
They supply natural gas and electricity to 9 million in the south, east and midwest. They're transitioning away from coal into low-carbon energy as they target 5-7% annual earnings growth in the next five years. It's working. It's up 2% YTD, trades at less than 20x PE and pays a 5% dividend. Utilities are a…
CMS Energy Corp (CMS-N)
Patricia K. Poppe is an American businesswoman and business executive, the president and CEO of CMS Energy since 2016. A utility operations company. One of the best run in the US. It is currently trading at a premium, but the quality justifies the price.
This is one of the best run utilities in the US. It is not a value play but a high quality play. It is another way to add to the utilities. It is trading at over 20X earnings to is trading at a premium, however, you are buying quality. It is the best run utility…
American Water Works Co. Inc. (AWK-N)
Susan N. Story is an American utility executive and the current Chief Executive Officer of American Water. They operate public water utility in the US and Canada. They have quite a high valuation with over 20 times earnings but it has performed well.
A solid company. Has owned this. A stable, steady grower, a play on the aging water works system in the U.S. Stimulus money helps upgrades in cities. AWK is a leading player here. Consistent shares, a long-term compounder. We are seeing more droughts and water scarcity due to global warming. Money flows from ESG funds…
Lockheed Martin (LMT-N)
Marillyn Adams Hewson is the chairman, president and chief executive officer of Lockheed Martin. A global aerospace and defense tech company. This tends to move higher with market volatility. They pay a good yield of 2.58%.
(A Top Pick Jan 05/22, Up 37%) Model price of $404, downside of -16%. War drums are pounding. Same issue as with BA, where a lot of their numbers are secret.
General Dynamics Corp. (GD-N)
Phebe Novakovic is an American businesswoman and former intelligence officer. She serves as the Chairwoman and Chief Executive Officer of General Dynamics. They make nuclear subs for the government and executive Gulfstream jets. 25% of their revenues are from aerospace and business jets. They just increased their dividend by 10% recently.
Raytheon vs. General Dynamics When analyzing a company, look at its peers as well. In this case, Raytheon offers a buffer to only the defence business--commercial aerospace. Two-thirds of revenues come from commercial, the rest in defence. The former is a great opportunity because more planes will be produced as the economy improves. Meanwhile, defence…
Occidental Petroleum Corp (OXY-N)
Vicki Hollub is an American businesswoman and mineral engineer. She has been the president and CEO of Occidental Petroleum since April 2016. A petroleum and natural gas exploration company. They are one of the largest US oil and gas company by equity market cap. They also own OxyChem which is a major chemical manufacturer.
Would not buy shares now (large upside has already occurred). Warren Buffett likes cash flow which company is excellent at producing. Not as much upside for company.