Houston Chronicle Sunday

Methodolog­y

- By Katherine Feser STAFF WRITER

The Houston Chronicle 100 rankings are based on the financial results of publicly traded Houston-area companies, which were collected and analyzed by S&P Global Market Intelligen­ce. Other charts in this special section are based on informatio­n drawn from many sources.

Kevin Kelly directed the research for S&P Global Market Intelligen­ce. He can be reached at 303-7214525 or kevin.kelly@spglobal.com. Find more informatio­n at www.spglobal.com/marketinte­lligence.

The Chronicle developed the criteria for the rankings, which reflect performanc­e as reported by public companies to the U.S. Securities and Exchange Commission.

The tables used numbers reported for calendar years 2017 and 2018, or as close as possible to the calendar year for companies with different fiscal years or reporting schedules. Data may reflect restatemen­ts for accounting changes, acquisitio­ns or discontinu­ed operations.

Other informatio­n was gathered by Chronicle researcher Katherine

Feser, who surveyed companies to determine the area’s largest employers, grocers, privately owned businesses, hospitals and law firms.

Chronicle 100 scores

Companies based in the Houston area were ranked by a score based on four categories for 2018: Total revenue, earnings-pershare growth, annual revenue growth and oneyear total return to shareholde­rs on a dividendre­invested basis.

The companies were ranked in each of the criteria, with each category given equal weight. The best possible score in each category is 1. To calculate the overall score, the four rankings were added and then divided by 4. If there was a tie, the change in earnings per share was used to break it.

To qualify, a company must have reported a profit for 2018 based on diluted net income per share before extraordin­ary items.

The company’s stock price must have been above $1 per share as of April 15, 2019, and it must have been trading for all of 2018. Companies must have had total sales exceeding $5 million for 2018 and $2.5 million for 2017.

The Chronicle 100 was derived from a list of 100 companies that met the criteria. All of the other public companies charts are based on a set of 158 companies.

General criteria

To qualify for charts based on financial performanc­e of publicly held companies, a company must be traded on a major stock exchange — New York, Nasdaq or NYSE Amex — and have its headquarte­rs in the Houston area. Some companies with dual headquarte­rs, primary administra­tive offices, major operations or CEOs based in the area were considered.

Revenue was defined as net sales for 2018. In most cases, sales exclude excise taxes and other non-operating income.

For banks and savings and loans, revenue equals total current operating revenue and net pretax profit and loss on securities.

For insurance companies, revenue equals the sum of earned premiums and net investment income. It excludes equity in other investment­s and foreign currency adjustment­s.

Earnings-per-share growth was based on the percentage change in the earnings per share before extraordin­ary items. EPS growth can include onetime gains or losses, such as profits on asset sales, as long as they are reported before taxes on income statements.

Where the earnings-pershare number in the previous year was negative, the percentage change was calculated using the absolute difference.

Largest companies

This chart ranks companies by annual revenue. To be considered, companies had to be publicly traded on Dec. 31, 2018, and have met other criteria for Chronicle 100 chart considerat­ion.

IPOs

This chart shows companies tracked by S&P Global Market Intelligen­ce that had an initial public offering of shares in 2018. The companies are ranked by the value of the offer amount. The current market capitaliza­tion may include additional shares issued in subsequent offerings and/or private placements. Spinoffs are also listed.

Revenue growth

The revenue growth chart ranks companies by the annual percentage gain in revenue in 2018. Auto dealers

Auto sales data were provided by InfoNation. Retail sales exclude fleet sales, defined as rental cars, dealer-owned loaner cars and vehicles purchased for lease by third parties. Banks

S&P Global Market Intelligen­ce ranked bank holding companies and commercial banks based on deposits in the Houston area as of June 30, 2018. Data are pro forma for acquisitio­ns that had closed or been announced as of March 29, 2019. Communitie­s and homebuilde­rs

Sales figures for homebuilde­rs and housing starts for the most active communitie­s were provided by Metrostudy. Homebuilde­rs were ranked by Houstonare­a sales that closed during 2018. The most active communitie­s were ranked by housing starts in 2018.

Employers, grocers, hospitals, law firms, private companies

The companies supplied the numbers, some of which are estimates, for a Chronicle survey. For additional charts, check out houstonchr­onicle. com/chron100.

Retail constructi­on

Wulfe & Co., a commercial real estate brokerage, developmen­t and property management firm, provided a list of the 2019’s 10 largest retail additions in the Houston area.

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