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Malcolm Baldrige National Quality Award Recipients' Stock Outperforms S&P 500

 
 

For the seventh straight year in a row, the Commerce Department's National Institute of Standards and Technology (NIST) has conducted a stock performance study of the Malcolm Baldrige National Quality Award winners. And for the seventh straight year in a row, the investment study has concluded that the Baldrige group stock has outperformed the S&P 500 -- this year by 4.4 to 1.

Here's how the fictitious Baldrige Index and stock investment study was conducted:

  • Index includes the publicly traded U.S. companies that won the Malcolm Baldrige National Quality Award between 1990 and 1999.
  • NIST invested a hypothetical $1,000 in each of the winners.
  • NIST also invested another hypothetical $1,000 in the S&P 500.
  • Investments were tracked from the first month following the award announcement through December 1, 2000.
  • Adjustments were made in the case of stock splits.

    Results For The Past Seven Years

  • 2001: Baldrige outperforms S&P 500 4.4 to 1
  • 2000: Baldrige outperforms S&P 500 almost 5 to 1
  • 1999: Baldrige outperforms S&P 500 2.6 to 1
  • 1998: Baldrige outperforms S&P 500 almost 3 to 1
  • 1997: Baldrige outperforms S&P 500 3.5 to 1
  • 1996: Baldrige outperforms S&P 500 4 to 1
  • 1995: Baldrige outperforms S&P 500 6.5 to 1

    Other Studies Have Concluded With Similar Results
    Other studies have indicated similar results. A joint study between the Georgia Institute of Technology and the University of Western Ontario found that quality award (including Baldrige) recipients experienced a 44 percent higher stock price return, a 48 percent higher growth in operating income, and a 37 percent higher growth in sales that a control group with similar size and industry standing. Other notable benefits included improvement in employment, and higher return on sales and asset growth.

    Visit the NIST news desk to read the full story.
    For a copy of this year's Baldrige Index stock study, visit NIST public affairs.

    Source: National Institute of Standards and Technology

     

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