Top 20 Companies
1. Wal-Mart Stores
CEO: Michael T. Duke
Wal-Mart rules the Fortune 500 for the second year in a row — and the eighth time this decade — beating Exxon Mobil decisively in the battle to be crowned America's largest company.
But things haven't been easy: Sales at its U.S. stores have dropped for seven straight quarters, despite gains in worldwide revenues and profits.
To fight back, CEO Michael Duke is restocking shelves with lower-priced products dropped by his predecessor, Lee Scott. He's also jumping on the anti-obesity bandwagon: Thousands of packaged food items are being reconfigured to cut their salt and sugar content.
2. Exxon Mobil
Rank: 2 (Previous rank: 2) |
Revenues ($ millions): 354,674.0
CEO: Rex W. Tillerson
The oil giant may not be the biggest company in the U.S., but it's by far the most profitable: Driven by higher prices for crude — as well as big gains in its natural gas and chemicals businesses — profits at Exxon Mobil topped $30 billion, a whopping 58% jump.
With its eye on growth, the company recently launched a massive joint venture in Qatar and an offshore well in eastern Russia. It also is making a big push into alternative energies, investing in biofuels and expanding operations designed to cut greenhouse gases.
3. Chevron
| Photo: Chevron |
Revenues ($ millions): 196,337.0
CEO: John S. Watson
Chevron's got some headaches to deal with: In Nigeria it faces ongoing hostilities from local thugs, and in Ecuador, it's fighting claims that its Texaco unit engaged in toxic-waste dumping.
So why not engage in a little retail therapy? In February, Chevron wrapped up its $3.2 billion acquisition of Pennsylvania's Atlas Energy, adding to its growing portfolio of natural gas operations. It also bought 200,000 acres of the Duvernay shale gas formation in Alberta, Canada. Expect the buying to continue: Chevron says it will boost capital spending 20% this year to $26 billion.
4. ConocoPhillips
Photo: ConocoPhillips |
Revenues ($ millions): 184,966.0
CEO: James J. Mulva
Conoco stock has been on a tear this past year, rising more than 40%, although it's still off sharply from its 2008 high. What's cheering investors? CEO James Mulva's plan to shed assets — more than $15 billion worth in the past 18 months — and reduce long-term debt.
The company also plans to drill 150 new oil wells this year in its Eagle Ford project in southern Texas and anticipates hitting peak production of some 65,000 barrels per day in 2013. Mulva's expanding shale operations, too, having added about 90,000 acres in North America last year.
5. Fannie Mae
Photo: John R. Coughlin |
Revenues ($ millions): 153,825.0
CEO: Michael J. Williams
Sure, it's still living off a lifeline from the federal government. But that hasn't stopped Fannie from leaping into the top 5 this year, up from no. 81. It's mostly new accounting rules, though, that have pushed Fannie so high on the 500.
Indeed, Fannie's troubles are far from over. In April, the SEC began investigating statements then-CEO Daniel Mudd made in 2007 to Congress that may have misrepresented Fannie's health. And FNMA stock has done so poorly that the New York Stock Exchange delisted it last June.
6. General Electric
Photo: General Electric |
Revenues ($ millions): 151,628.0
CEO: Jeffrey R. Immelt
Jeffrey Immelt's decade-long tenure as CEO has been one of "decline, mistakes, and wealth destruction," Fortune concluded recently. And the nuclear disaster in Japan, involving GE-designed reactors, hasn't helped the conglomerate's reputation.
7. Berkshire Hathaway
Photo: John R. Coughlin |
Revenues ($ millions): 136,185.0
CEO: Warren E. Buffett
Just about every company in Warren Buffett's fold is firing on all cylinders and cash-flush Berkshire will likely make some big acquisitions in the future. But the Oracle of Omaha faces a few uncertainties ahead.
For one: It's still unclear if there will be an investigation into David Sokol, the former Buffett heir apparent who quit in March. His resignation followed revelations that Sokol bought shares of Lubrizol shortly before Berkshire's $9 billion bid for the company.
Also hazy: just how much exposure Berkshire's reinsurance operations have to the Fukushima nuclear disaster in Japan. Luckily, Buffett keeps $20 billion in Berkshire's sock drawer to cover such unforeseen emergencies.
8. General Motors
Photo: General Motors |
Revenues ($ millions): 135,592.0
CEO: Daniel F. Akerson
Bailed out and buffed up, GM emerged from bankruptcy with a $20 billion public offering in November, the largest IPO in U.S. history. Early results look good: The automaker posted its first annual profit in six years.
Daniel Akerson, GM's fourth CEO since the government's $50 billion rescue three years ago, plans to focus on four major brands — Chevrolet, Cadillac, Buick, and GMC. The goal is to cut inventory, close plants and dealerships, and otherwise improve efficiency. One sign of success: Its latest model, the Chevy Volt plug-in hybrid, was named Motor Trend's Car of the Year.
9. Bank of America Corp.
Photo: John R. Coughlin |
Revenues ($ millions): 134,194.0
CEO: Brian T. Moynihan
CEO Brian Moynihan may have hoped that predicting $45 billion to $50 billion in earnings down the road would mollify investors distressed at the bank's $5.8 billion in losses over the last two years.
But some critics think the embattled bank chief is being overly optimistic. After all, Bank of America still needs to resolve continuing issues from the mortgage mess and a number of embarrassing lawsuits over the bank's foreclosure practices. And shares are off 78% from their pre-meltdown high — no wonder the Fed recently nixed the bank's plans to restore a dividend program.
10. Ford Motor
Photo: Ford Motor |
Revenues ($ millions): 128,954.0
CEO: Alan R. Mulally
Riding on strong sales of the Fiesta and a redesigned Taurus, Ford turned in its best annual profit since 1999 last year.
In the U.S., CEO Alan Mulally shuttered Ford's Mercury division, completed the sale of Volvo, divested its Mazda shares, and saw sales jump 17%.
11. Hewlett-Packard
Photo: Hewlett-Packard |
Revenues ($ millions): 126,033.0
CEO: Leo Apotheker
Five months after taking over the top spot from ousted chief Mark Hurd, new CEO Leo Apotheker spelled out his plan to transform HP. The goal: Dominate cloud computing, encouraging consumers and businesses to use HP hardware to connect with public and private networks.
To do so, the company will draw heavily on recent acquisitions, including last year's $2.7 billion purchase of 3Com and its $1.2 billion buyout of Palm.
Already the world's biggest PC manufacturer, HP secured a partnership with IBM to become the world's biggest seller of servers.
12. AT&T
Photo: AT&T |
Revenues ($ millions): 124,629.0
CEO: Randall L. Stephenson
AT&T has taken a lot of heat about the quality of its wireless network. So much so, perhaps, that it recently agreed to pay $39 billion for T-Mobile USA — a smaller rival that once ran ads ridiculing AT&T's service.
The combined entity — which has yet to get past Washington's antitrust watchdogs — would allow AT&T to spread the cost of running a national network over an additional 34 million customers.
Best of all: Adding T-Mobile's spectrum and cell towers to the mix should do much to alleviate the massive congestion that has taxed AT&T's existing infrastructure for years.
13. J.P. Morgan Chase & Co.
Photo: John R. Coughlin |
Revenues ($ millions): 115,475.0
CEO: James Dimon
Of the big U.S. banks, Jamie Dimon's is the only one that didn't turn in a losing quarter during the financial crisis. Recovery is bringing stronger results: J.P. Morgan Chase posted record profits in 2010
14. Citigroup
Photo: John R. Coughlin |
Revenues ($ millions): 111,055.0
CEO: Vikram S. Pandit
Things are looking up for Citigroup. For the first time since 2006, the bank logged four consecutive quarters without a loss. Meanwhile a newly restored dividend — albeit a measly one penny per share — and a ten-for-one reverse stock split could drag its shares out of the single digits.
But investors still have a lot to be wary about. The company continues to unload assets — some $108 billion worth last year alone. Add the ongoing ramifications of financial reform and the credit card act, and Citi's top-line growth looks pretty hamstrung down the road.
15. McKesson
Photo: McKesson |
Revenues ($ millions): 108,702.0
CEO: John H. Hammergren
The nation's largest health-care provider greatly expanded its already extensive cancer treatment business when it bought U.S. Oncology for $2.2 billion last December.
16. Verizon Communications
Photo: Verizon Communications |
Revenues ($ millions): 106,565.0
CEO: Ivan G. Seidenberg
To hear CEO-in-waiting Lowell McAdam tell it, Verizon is about to "kick into a higher gear." Why? Outgoing chief Ivan Seidenberg has invested heavily the past few years in next-generation broadband technologies such as FiOS, a high-speed fiber optic service, and LTE, a 4G wireless network.
Combined with its growing video and cloud computing services, which should also get a boost from Verizon's purchase of Terremark in January, these businesses now account for three-quarters of sales. Then of course there's the iPhone, which Verizon began selling earlier this year. No wonder the communications giant shrugged off the planned union between AT&T and T-Mobile.
17. American International Group
Photo: John R. Coughlin |
Revenues ($ millions): 104,417.0
CEO: Robert H. Benmosche
Sure, AIG turned in the worst underwriting results among the nation's big insurers — paying out nearly 30% more on claims and expenses than it received in premiums. Still, AIG swung to a tidy profit last year after a disastrous 2009.
For that bit of financial wizardry, credit outspoken CEO Robert Benmosche, who's defying all odds turning around the beleaguered insurance giant. The company has repaid billions to the government — including its entire obligation to the Fed — and regained access to credit and debt markets. A recent move: unloading two insurance units for $37 billion.
18. International Business Machines
Photo: IBM |
Revenues ($ millions): 99,870.0
CEO: Samuel J. Palmisano
When Big Blue celebrates its centennial later this year, it will do so in style. Sales reached almost $100 billion in 2010 and profits, which have quadrupled during CEO Sam Palmisano's nine-year reign, hit a record.
The secret: a heavy focus on innovation. IBM spent $24 billion on R&D last year and filed over 18,000 patents — more than any other company in the world. Most firms pulled back during the recession, while IBM invested big in projects like artificial intelligence (who didn't watch Watson on Jeopardy?) and Smart Planet, its plan to use networking computer technology to ease traffic congestion and overtaxed power grids.
19. Cardinal Health
Photo: Cardinal Health |
Revenues ($ millions): 98,601.9
CEO: George S. Barrett
In a business where big players claw away at each other's ultra-slim operating margins, drug distributor Cardinal Health sharpened its nails with two strategic acquisitions last year.
In China, one of the world's fastest growing health care markets, Cardinal paid $470 million for Zuellig Pharma China, the country's largest pharmaceutical importer. In the U.S., it bought Kinray from billionaire Stewart Rahr for $1.3 billion, which will add some 2,000 higher-margin independent pharmacies to Cardinal's distribution channel. A new, three-year $750 million stock repurchase plan should also give a boost to the company's shares.
20. Freddie Mac
Photo: John R. Coughlin |
Revenues ($ millions): 98,368.0
CEO: Charles E. Haldeman Jr.
The smaller of the two mortgage giants, Freddie Mac has stayed on its feet because of the roughly $64 billion in government bailout money it's received. Along with Fannie Mae, Freddie Mac still guarantees or owns half of all U.S. residential mortgages, and the government support has allowed both companies to more or less freeze time on their balance sheets for years now.
The Obama administration has outlined plans to phase out government support for Freddie and Fannie, but there's a long road ahead: By the administration's estimate, that process could take up to seven years.
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