Oklahoma's economy has weathered the Great Recession as well as any state's, and the state's public companies have demonstrated a similarly robust constitution. An index that represents the stocks of Oklahoma's 31 largest public companies reflects that strength. The SPADE Oklahoma Index grew nearly 32 percent from July 1, 2009, through June 30, 2010 — the time frame that coincides with the period of evaluation of nearly all of the Oklahoma Inc. stocks. In the same period, the Standard & Poor's 500 gained about 12 percent. In other words, a $1,000 investment in that Oklahoma index would have produced a profit of $320 over the past year, compared with a $120 gain in the investment in the S&P 500. Jim Huntzinger, chief investment officer for Tulsa's BOK Financial, said two factors appear to have played a role in the strong performance of state-based stocks. "The emphasis in Oklahoma publicly traded companies from the energy sector has helped performance this year, and therefore the whole group is doing better than the general market,” Huntzinger said. In the first nine months of 2010, the stocks of Oklahoma energy companies have gained about 16 percent, well above the 6 percent return of the S&P 500, Huntzinger said. Many of the state's public companies also are long-term players in their market, he said. "Along with that comes stability and also probably comes lower debt levels,” Huntzinger said. "Many of these companies have debt levels that are very manageable.” The dangers of excess leverage have been highlighted as the nation entered the Great Recession and now begins a slow economic recovery, he said. The strong stock performance of state companies reflects a remarkable turnaround after a year that was marked with huge losses and massive uncertainty, Tulsa money manager Fred Russell said. "It's been a good year — a very good year,” said Russell, head of Fredric E. Russell Investment Management Co. Even by Wall Street standards, Oklahoma is more than OK.Comments
MeasurementsWhile shareholders are most interested in the return on their investments, Oklahoma Inc. tracks two other metrics to rank the state's public companies. The 36 state-based firms that trade on major exchanges are ranked by each of the three measures, and the company that achieves the best overall rankings collects the top spot. Total return to investors includes gains or losses in stock price plus any dividends. Dollar Thrifty Automotive Group claimed that category with a 205 percent return. Tulsa-based Dollar Thrifty also posted the best result in earnings per share growth with a jump of 283 percent. Continental Resources, an Enid-based energy company, took the top spot in revenue gain, posting a one-third increase in its revenue growth over the previous year. Continental Resources, which also posted strong numbers in the earnings and stock return categories was the top-rated company in this year's Oklahoma Inc. The Oklahoma Inc. methodology rewards companies that grow quickly, boost profits and benefit shareholders. Rare is the company that can do all three simultaneously.
State stocksOklahoma's public companies are dominated by energy firms. The 10 largest companies all are in the energy business, although their business models differ. While natural gas prices remain stagnant and lower than most in the business here would like, several of the state's energy companies prospered over the past year. Continental Resources, which has secured a foothold in the oil-rich Bakken Shale of the Dakotas, has benefitted from strong crude prices. Second-ranked Williams Partners, of Tulsa, posted strong shareholder returns and grew its revenues. The partnership, created by Williams Cos. Inc. to hold assets like pipelines, benefitted from a transaction this year that vastly increased the size of the business, making it one of the largest master limited partnerships in the nation. Dollar Thrifty earned the third-place rank, with a slight dip in revenues being the only obstacle to a higher ranking. Dollar Thrifty has completed a remarkable turnaround since the depths of the recession in late 2008 that has produced huge gains in the company's stock price. The company restructured its debt, shed some unfavorable deals related to its rental vehicle fleet, and has been courted by some of the rental car industry's biggest players. Fourth-ranked Magellan Midstream Partners also was created by Williams Cos. Inc., which later sold its stake to private equity investors. Last year, Magellan absorbed its holding company in a move designed to save money, help fund acquisitions and reduce regulatory reporting duties. The move paid off as Magellan performed well in each of the three Oklahoma Inc. categories. Another energy-based partnership, Alliance Holdings, claimed the fifth-place spot. Alliance is a Tulsa-based company that holds assets of Alliance Resource Partners LP, one of the nation's top coal producers. Alliance earned top-five rankings in total return to shareholders and revenue growth.