Investing

The 100 Top Brands
Business Week (BW)published the top 100 global brands for 2003. They have interestingly valued the brands (not the market cap of the company but just the brand). Coke has the highest value brand at $70.5B, BW is effectively saying that buying the coke brand from coke would cost $70.5b, leaving $36Bn for everything except the name coke. Microsoft came in second with a brand value of $65Bn (their market cap is $282Bn). This pretty much confirms that coke is mainly the "coke brand", Microsoft is much more than their brand - $220bn more in fact.

Great brands take so much investment that it is reasonable to say they provide a sustainable competative advantage. Therefore I looked if the top 10 brands of publicly traded companies (excluding ADR's) outperformed the S&P 500. I considered Coke, Microsoft, IBM, GE, Intel, Disney, McDonalds, HP, Citibank and Ford.

Returns	5 Year	10 Year	15 Year
Exceed S&P	6	7	9
Underperform S&P	4	3	1

Nine of these companies also exceeded the S&P 500 average Return on Equity over 5 and 10 years. This shows that these companies can leverage their brands to turn retained earnings into even greater profits than their peers over time.

Though I didn't really look at enough data, it seems plausible that over increasingly long periods of time, those companies with the highest value brands can earn market beating returns.