The 25 Best Companies in America

 

Public companies traditionally receive acclaim for delivering rapid earnings growth along with a rising stock price. Wall Street and the financial media encourage executives to "beat earnings targets," and boards pay them astronomical sums for doing so.

But a preoccupation with how investors are doing in the present can result in unfortunate outcomes. For example, Countrywide delighted its shareholders with huge profits from 2003 to 2006. Alas, the nation's largest mortgage lender all but drove itself into bankruptcy by mistreating its employees, homeowners, and mortgage investors. On a more mundane level, anyone who's ever had to deal with a surly checkout clerk can tell you that failing to look after employees and customers can result in lost future business for a retailer.

Several studies suggest that companies that focus on multiple stakeholders tend to achieve better financial performance over the long term. Intuitively, this makes sense, too, because, as professor Ed Freeman of the Darden School of Business at the University of Virginia puts it, "business is about how customers, suppliers, employees, financiers, communities, and managers interact and create value."

We strongly believe that the greatest and most successful companies are those that are able to benefit all of the various groups.

For the past several months, we have been compiling data and analyzing more than 1,700 public companies to discover the 25 best public companies in America, measured by their success in serving investors, customers, employees, and the world at large. We're delighted to finally be able to share our findings. You can read more about all 25 of them below.

Click here if you're curious about how we made the rankings.

Expand All
#1 Cummins (NYSE: CMI)
Market Cap $21.81 billion
  • Investor -- 8.5

     
  • Customer -- 9.6

     
  • Employee -- 8.3

     
  • World -- 10

     

Cummins is a leader in the design and manufacture of world-class, high-performance engines for trucks, buses, light-duty vehicles, and heavy equipment. It also produces power generation equipment like diesel generators, emissions solutions, and fuel systems.

Cummins' products are renowned for their fuel efficiency and reliability. Consistently high quality and customer satisfaction enable it to earn superior returns on capital.

Employees laud the company's integrity, work-life balance, and culture of development. Cummins has aggressively cut its own greenhouse gas emissions and invests significantly in education and philanthropy efforts across the globe. As more countries adopt progressively stricter efficiency and emissions standards, Cummins' technological edge should prove an enduring advantage. Keep reading about Cummins.

#2 Teradata (NYSE: TDC)
Market Cap $9.83 billion
  • Investor -- 9.3

     
  • Customer -- 6.8

     
  • Employee -- 8.9

     
  • World -- 8

     

Teradata is one of the world's most-respected names when it comes to handling, synthesizing, and analyzing information. Combining traditional data warehousing with advanced tools for analysis has kicked up growth and returns on capital in recent years.

Employees laud Teradata's friendly and helpful teammates, excellent work-life balance, and professional growth opportunities. The company has implemented a variety of energy-saving techniques that have allowed it to dramatically reduce its energy and emissions intensity.
Keep reading about Teradata.

#3 Colgate-Palmolive (NYSE: CL)
Market Cap $53.6 billion
  • Investor -- 8.9

     
  • Customer -- 7.4

     
  • Employee -- 9.1

     
  • World -- 7

     

A full quarter of Colgate-Palmolive's approximately 40,000 employees have been with the company for more than 20 years. That remarkable loyalty is a product of the company's values – caring, global teamwork, and continuous improvement – as well as its commitment to generous benefits and a healthy work-life balance. In 2010, the company donated $18 million in cash and $21 million in in-kind donations to support various communities around the world.

Colgate also generates incredible returns on capital. It has paid uninterrupted dividends since 1895, and has hiked its dividend for 49 straight years. Keep reading about Colgate-Palmolive.

#4 Google (Nasdaq: GOOG)
Market Cap $264.6 billion
  • Investor -- 8.5

     
  • Customer -- 6

     
  • Employee -- 9.5

     
  • World -- 9

     

Google's mission is to organize the world's information, and make it universally accessible and useful. It offers the most popular search (Google), email (Gmail), mobile operating system (Android), and video website (YouTube) in the world. Key to achieving its ambitious mission is unleashing its employees' passion. Aside from the generous perks the company is well-known for, Google strives to create a "family" work atmosphere that emphasizes freedom and transparency. It's the most-desired employer in the world, according to LinkedIn data.

Google holds up remarkably well to its corporate motto: "Don't be evil" (tax avoidance aside). Its panoply of services brings perhaps more information to more people than at any time in history. In the most recent year, Google provided more than $100 million in grants to nonprofits and educational causes around the world.
Keep reading about Google.

#5 Skyworks (Nasdaq: SWKS)
Market Cap $3.9 billion
  • Investor -- 7.1

     
  • Customer -- 8.9

     
  • Employee -- 8.5

     
  • World -- 7

     

Skyworks Solutions' chips, which are used in mobile devices, cars, medical devices, and military supplies, refine and amplify messy real-world data like radio waves before passing along a cleaner, stronger signal.

Skyworks sets itself apart with a laser-like focus on product quality and a unique control over bleeding-edge manufacturing processes. Employees like its innovative environment, supportive co-workers, and benefits. In recent years, Skyworks has dramatically cut its water use and hazardous waste production, while also boosting the energy efficiency of its plants. One big headwind for the company, however, is that it operates in an increasingly crowded field.
Keep reading about Skyworks.

#6 Biogen Idec (Nasdaq: BIIB)
Market Cap $38.2 billion
  • Investor -- 8.6

     
  • Customer -- 5.2

     
  • Employee --9.2

     
  • World -- 9

     

One of the first biotechnology companies, Biogen invents and markets vital drugs that target unmet medical needs. It sells three drugs that treat multiple sclerosis, while also possessing a streamlined product pipeline. Although its medications are expensive, Biogen does reinvest a large share of its profits into researching new drugs, and in 2011 the company provided $284 million in financial support to patients.

Employees enjoy generous benefits that go far above and beyond traditional offerings. Biogen is also committed to helping employees achieve a positive work-life balance.
Keep reading about Biogen Idec.

#7 Akamai (Nasdaq: AKAM)
Market Cap $6.5 billion
  • Investor -- 7.1

     
  • Customer -- 7.5

     
  • Employee -- 9.1

     
  • World -- 7

     

Akamai is making the Internet a better place by removing bottlenecks that would otherwise brake traffic. Employees are inspired by the company's mission, close teamwork, and generous benefits, which include unlimited vacation time.

Since 2009, Akamai has worked to increase the efficiency of its 100,000-plus server network. "Carbon intensity," a measure that reflects the Akamai network's need for power and environmental impact, is down roughly 75% over that period. Keep reading about Akamai.

#8 Lincoln Electric (Nasdaq: LECO)
Market Cap $4.5 billion
  • Investor -- 7.2

     
  • Customer -- 8.0

     
  • Employee -- 8.8

     
  • World -- 6

     

For 79 straight years, this welding materials manufacturer has paid its work force an annual bonus – last year averaging nearly $34,000 per worker. No one has been laid off for more than 65 years. Holding onto its experienced work force allows Lincoln to retain the human capital it has trained and developed, saving it from having to reinvest in bringing new employees up to speed.

Lincoln Electric makes its products an essential part of its customers' work. By keeping its equipment easy to use yet effective for the multiple purposes it must serve, Lincoln Electric builds loyalty among those who use its products, making it more likely that they'll come back as repeat customers. Keep reading about Lincoln Electric.

#9 Costco (Nasdaq: COST)
Market Cap $43.3 billion
  • Investor -- 7

     
  • Customer -- 8

     
  • Employee -- 8.9

     
  • World -- 6

     

Membership retailer Costco has defied Wall Street "wisdom" through generosity to employees and devotion to customers, making investors rich along the way. Costco has turned the traditional retail model on its head. Instead of squeezing employees and selling items for as high a mark-up as possible, Costco provides living wages and benefits to employees, while finding unique deals for customers that it sells near cost. Membership fees provide the profits.

This successful stakeholder-focused approach has helped Costco to grow its sales over decades by creating one of the lowest employee turnover rates in the industry and a startlingly loyal membership base. Keep reading about Costco.

#10 Under Armour (NYSE: UA)
Market Cap $4.9 billion
  • Investor -- 9.5

     
  • Customer -- 8.8

     
  • Employee -- 6.1

     
  • World -- 5

     

Under Armour designs and sells high-performance athletic apparel and footwear. Sales have tripled in just the past five years as demand grows for its branded clothing with unique properties for keeping athletes dry. Keep reading about Under Armour.

#11 Coach (NYSE: COH)
Market Cap $13.5 billion
  • Investor -- 8.7

     
  • Customer -- 9.7

     
  • Employee -- 8.1

     
  • World -- 4

     

Coach, a leading marketer of fine accessories, is the company that its competitors aspire to be. Quality goods, limited locations, and luxury prices underlie Coach's fierce commitment to its aspirational brand. That focus leads to fanatically loyal customers and enviable returns on capital. It also allows Coach to provide outstanding benefits and professional development opportunities – all of which make the company extremely attractive to both prospective and existing employees.

The biggest challenge for Coach is protecting its brand value. In the world of fashion, tastes can be fleeting, and competition in core product lines like handbags is rising. Coach may also want to provide more transparency into the labor practices of its East Asia-based independent manufacturers.
Keep reading about Coach.

#12 Whole Foods (Nasdaq: WFM)
Market Cap $15.6 billion
  • Investor -- 6.9

     
  • Customer -- 7

     
  • Employee -- 7.8

     
  • World -- 10

     

Whole Foods Market disrupted a traditionally low-growth, low-margin sector: grocery retail. Embracing the "shared fate" of its stakeholders has been core to the company's values – and competitive advantage – since its beginning. Whole Foods places a premium on customer service, and has been able to promote that goal by caring about and empowering its "team members."

In addition to its myriad sustainability initiatives, Whole Foods dedicates at least 5% (currently $23 million) of after-tax profits to non-profits; in the last three fiscal years, its donations (including in-kind food donations) amounted to more than 10% of after-tax profits.

Key challenges for the company include changing some customers' perceptions that its food is too expensive without sacrificing quality, as well as continuing to defy the low-growth, low-margin norms of the grocery industry. Keep reading about Whole Foods.

#13 PepsiCo (NYSE: PEP)
Market Cap $116.7 billion
  • Investor -- 9.1

     
  • Customer -- 8.9

     
  • Employee -- 6.4

     
  • World -- 5

     

PepsiCo manufactures and sells 22 beverage, snack, and food brands, including Pepsi (currently ranked the 22nd most valuable brand in the world), Quaker Oats, Frito-Lay, Tropicana, and Gatorade. It's a high return-on-capital business that's growing at home and around the world.

With obesity becoming increasingly perceived as a major health risk, however, PepsiCo is working to address criticism over the unhealthiness of many of its products. A failure to succeed in changing consumer perceptions could harm the company's bottom line.

In 2011, PepsiCo invested $525 million to research healthier ingredients and implement more environmentally sustainable operations. It has also replenished water resources and is working to improve water-use efficiency after allegations in the 2000s that it contributed to water shortages in developing countries. Keep reading about PepsiCo.

#14 Brown-Forman (NYSE: BF.B)
Market Cap $14.1 billion
  • Investor -- 7.6

     
  • Customer -- 8.1

     
  • Employee -- 8.5

     
  • World -- 5

     

Brown-Forman has more than 25 brands in its portfolio of wines and spirits, the most popular of which is Jack Daniels, the largest-selling American whiskey brand in the world by volume. Employees cite competitive compensation, as well as perks like an on-site gym and in-house café, on-site health screening, and employee assistance counseling and advice. The company has a chief diversity officer and a diversity council working to foster a greater sense of community and inclusion.

Although the social costs of alcohol abuse are significant, Brown-Forman has worked to raise awareness by supporting initiatives such as The Ad Council's "Buzzed Driving is Drunk Driving" campaign. In 2012, the company made $8.2 million in charitable contributions, largely to cultural organizations and alcohol education, and has committed itself to meeting aggressive environmental goals over the coming years. Keep reading about Brown-Forman.

#15 PVH (NYSE: PVH)
Market Cap $8.55 billion
  • Investor -- 7.1

     
  • Customer -- 8.8

     
  • Employee -- 7.1

     
  • World -- 7

     

PVH Corp designs and markets popular apparel under brand names including Calvin Klein, Tommy Hilfiger, and Van Heusen. The apparel business is notorious for poor labor conditions, but PVH has been methodically improving its suppliers' factories in Asia and around the world.

In 2011, the company also gave more than $6 million, raised nearly $2 million, and donated more than $13 million worth of clothing to philanthropic efforts. Keep reading about PVH.

#16 Cirrus Logic (Nasdaq: CRUS)
Market Cap $1.56 billion
  • Investor -- 9

     
  • Customer -- 8.9

     
  • Employee -- 6.1

     
  • World -- 5

     

Fabless semiconductor maker Cirrus Logic primarily designs high-end audio chips for use in Apple mobile devices. The company uses its strong knowledge of Apple's needs to profitably design new chips that make their way into more and more products.

Over the past five years, sales have tripled, and shares are up five-fold. Cirrus stands to benefit as it tackles new opportunities like the booming LED lighting field. Keep reading about Cirrus Logic.

#17 Nordstrom (NYSE: JWN)
Market Cap $10.35 billion
  • Investor -- 7.6

     
  • Customer -- 7.9

     
  • Employee -- 7.9

     
  • World -- 6

     

Nordstrom is an unusual fashion retailer in that it combines two completely different target segments within a single business. Traditional Nordstrom stores focus on high-end luxury shopping, while Nordstrom Rack offers discounts. With sales roughly split evenly between the two sets of stores, Nordstrom has cultivated a reputation for quality and customer service that has developed strong loyalty among all of its shoppers.

The retailer also offers a fun work environment, along with pay and benefits that are unparalleled in the industry. In 2011, Nordstrom's average worker earned more than $19 per hour, nearly 60% higher than the industry average. Benefits include health insurance, a 401(k) program, disability and life insurance, and opportunities for an unpaid annual sabbatical. Keep reading about Nordstrom.

#18 Rockwell Automation (NYSE: ROK)
Market Cap $12.4 billion
  • Investor -- 8.3

     
  • Customer -- 7.8

     
  • Employee -- 6.5

     
  • World -- 7

     

Rockwell Automation is a leading provider of industrial automation equipment and services – solutions that help other manufacturers become more efficient. Its dedicated focus on automation has allowed it to out-innovate its bigger, more diversified competitors and deliver double or triple their returns on capital.

It's shoveled much of that cash right back to shareholders, growing its dividend by more than 60% since 2010 and investing more than $2 billion in stock repurchases since 2007.
Keep reading about Rockwell Automation.

#19 V.F. Corporation (NYSE: VFC)
Market Cap $17.4 billion
  • Investor -- 7.6

     
  • Customer -- 8

     
  • Employee -- 8

     
  • World -- 5

     

V.F. Corporation, one of the world's largest apparel companies, has an impressive array of popular brands, which include North Face, Timberland, Lee jeans, and Vans shoes. Employees receive great discounts on company gear and generally enjoy a relaxed work environment.
Keep reading about V.F. Corporation.

#20 Starbucks (Nasdaq: SBUX)
Market Cap $39.23 billion
  • Investor -- 8.9

     
  • Customer -- 5.6

     
  • Employee -- 8.3

     
  • World -- 6

     

Starbucks revolutionized the coffee experience, and created the United States market for gourmet coffee. In so doing, it built a top-notch brand and a coffee empire that generates impressive returns on capital. Today, the company has more than 17,000 stores in 55 countries.

The restaurant industry may be infamous for treating rank-and-file workers poorly, but Starbucks employees generally feel valued and respected. The company offers flexible work hours, as well as benefits and stock rewards for those who work at least 20 hours per week. While Starbucks has built a reputation among customers for consistency and quality, the company has yet to convince many customers that its coffee is not overpriced. Keep reading about Starbucks.

#21 Female Health (Nasdaq: FHCO)
Market Cap $204 million
  • Investor -- 9.6

     
  • Customer -- 8.2

     
  • Employee -- 3

     
  • World -- 9

     

Female Health Company manufactures and sells the second-generation FC2 female condom. Its main customers are non-profits and government entities working to stop the spread of HIV in South Africa, central Africa, Brazil, and southeast Asia. They value the uniqueness and safety of Female Health's patent-protected product, as well as the FC2's affordability.

Valued at just $200 million, Female Health is by far the smallest of our 25 Best Companies. Yet the company has managed to keep prices down without sacrificing growth or its massive returns on capital. Keep reading about Female Health.

#22 Clorox (NYSE: CLX)
Market Cap $10.94 billion
  • Investor -- 7.6

     
  • Customer -- 7.3

     
  • Employee -- 7.5

     
  • World -- 6

     

Clorox is best known for its bleach, but it also produces Liquid-Plumr, Kingsford charcoal, Glad garbage bags, and Brita water filters, among other brands. Clorox builds lifelong customer loyalty through attractive marketing and superior performance of its products. And the results speak for themselves: 90% of Clorox products rank first or second in market share in their category.

Just as consumers depend on the reliability of Clorox products, investors like that the company reliably returns capital to shareholders. Clorox is a "Dividend Aristocrat," an elite designation Clorox earned by increasing dividends every year for 35 years. One big danger for the company in the near future is that its growth might be too slow to meet market expectations. Keep reading about Clorox.

#23 Aflac (NYSE: AFL)
Market Cap $22.83 billion
  • Investor -- 8.7

     
  • Customer -- 8.8

     
  • Employee -- 3.8

     
  • World -- 7

     

Aflac provides coverage to more than 50 million people worldwide, insures roughly one out of every four households in Japan, and is the largest provider of supplemental insurance in the United States. It produces impressive returns on capital.

Employees enjoy a positive work-life balance, though many of its commission insurance salespeople have a negative experience with cold calling and ambitious recruitment goals.
Keep reading about Aflac.

#24 IBM (NYSE: IBM)
Market Cap $225 billion
  • Investor -- 7.8

     
  • Customer -- 7.1

     
  • Employee -- 5.4

     
  • World -- 9

     

IBM is a giant in the information technology industry with a self-professed aim to "make the world work better." IBM's brand – currently ranked the 3rd most valuable in the world – supports a lucrative consulting business that allows the company to generate returns on capital north of 25%.

The company has aggressively cut its energy use, saving money and reducing emissions. Its energy- and water-management software solutions help customers save resources and money, too.

In 2011, IBM donated nearly $47 million and another $149 million worth of technology and services, primarily to educational initiatives like building a nonprofit cloud network or tutoring high school students in computer science. Up to 160,000 of the company's employees may be involved in community service at any given time. Keep reading about IBM.

#25 Intel (Nasdaq: INTC)
Market Cap $101.7 billion
  • Investor -- 7

     
  • Customer -- 4.6

     
  • Employee -- 8.8

     
  • World -- 8

     

Intel has been on the leading edge of microprocessor manufacturing since 1971. As the largest company in the business, Intel's chips are primarily used in PCs and servers, but the company hopes to soon crack the mobile market to provide the world's preferred processor for smartphones, tablets, and any other super-portable devices yet to come.

Intel is also one of the most coveted workplaces in the world among hardware engineers. Employees enjoy a fun work environment, helpful teammates, and reasonable hours. Benefits include a $50,000 tuition reimbursement, on-site medical care, and an eight-week paid vacation -- offered on top of normal vacation time -- every seven years.

It matches philanthropic grants from its employees, bringing 2011 donations to $26 million in pursuit of initiatives ranging from maximizing energy efficiency to providing educational materials in developing countries through more than 7 million PCs delivered via nonprofit collaboration. Keep reading about Intel.

This special report was written by Ilan Moscovitz and John Reeves. Ilan Moscovitz owns shares of Apple, Google, and Whole Foods. John Reeves owns shares of Apple, Google, and Starbucks. The Motley Fool owns shares of Apple, Under Armour, International Business Machines, Costco Wholesale, Starbucks, Google, Cirrus Logic, Whole Foods Market, Intel, and PepsiCo. Motley Fool newsletter services have recommended buying shares of Starbucks, Costco Wholesale, Coach, PepsiCo, Whole Foods Market, Cummins, AFLAC, Apple, Intel, Google, Teradata, and Under Armour. Motley Fool newsletter services have recommended creating a bull call spread position in Apple. The Motley Fool has a disclosure policy.