There’s nothing like a company that takes care of its own. The best companies to work for usually include stories about employees working on their own schedule, taking long breaks, enjoying an in-house masseuse, and hiring Mario Batali for staff lunches warms the hearts of most people, making us all believe that taking care of one’s employees is the best way to maximum productivity.
That is, unless you’re a shareholder in that company. Then, said stories could just as easily be giving one an ulcer. It’s easy to laud a company’s lavish spending on its workers when you aren’t invested in its profits. But, how do the best company’s to work at stack up as company’s to invest in? Are these businesses as good to their investors as they are to their people?
Google (GOOG) as an Employer vs. Investment
Google was ranked the number one place to work on Fortune Magazine’s list and the number five place to work on Glassdoor.com’s list. The company with the corporate motto, “Don’t be evil” has long stood out as a model for quirky, open thinking and taking care of its own. Larry Page, the company’s CEO, has a 92 percent approval rating and pays its Software Engineering Interns (yes, interns) an average of $6,800 a month. Says one former employee on Glassdoor.com:
“You’ll work with very smart people, and get a lot of support and feedback around doing your best work. Most senior managers have great knowledge, a lot of advice to offer, and value open, transparent communication. You’ll likely work the hardest you’ve ever worked at Google, but you’ll also be greatly rewarded.”
But what does all this mean to shareholders? Google recently announced an effective stock split, which will be issued as a dividend, that will create a new class of shares and issue them to existing shareholders. The company’s also made modest gains over the last year, gaining close to 15 percent. That’s not the sort of wild success that one might hope for, but it’s certainly nothing to scoff at.
NetApp (NTAP) Employee Incentives
NetApp is a data storage company that’s made Fortune’s list of best places to work seven straight years, placing in the top 50 each time. NetApp has endeared itself to employees with a generous pay-for-performance program that has proved lucrative for the company’s employees. In 2010, when revenues jumped from $3.9 billion to $5 billion, some employees received bonuses of as much as 31 percent of their salaries.
However, the hefty payouts to employees didn’t exactly pay off in 2011. Over the last year, NetApp is off over 16 percent, suffering heavily through the early August market swoon and only partially rebounding since. This hiccup, though, belies a stronger bull run that preceded last year. The company’s up 12.75 percent over the last five years, and it had a stretch from late October of 2008 to Mid February of 2011 when the company leapt over 350 percent.
Ups and Downs of Camden Property Trust (CPT)
Camden is an apartment management firm that houses over 100,000 people in 13 states. It’s made its employees happy by offering surprise bonuses between $100 and $5,000. The Houston, TX company is number seven on Fortune’s list. One former admin assistant raved about the job on careerbliss.com:
“I enjoyed the fast paced environment and having constant, multiple deadlines. I liked the construction industry and the wide variety of job responsibilities that I had at Camden.”
While the share price for Camden experienced a wild 2011, plunging in early August, rebounding immediately after, plunging again in early October, and then slowly making a come back to today. Now, it’s up almost 14 percent over the last year and offers a 3.38 percent dividend yield.
Wake Up Call for Dreamworks Animation (DWA)?
I mean, who wouldn’t want to work with Shrek, right? Operating out of sunny Glendale, CA, Dreamworks animation is a creative hotbed. Employees seem to love the accessibility of CEO Jeffrey Katzenberg, who takes the time to meet all new hires and send out a daily e-mail update. Unless, of course, you’re looking for a really authentic Hollywood experience with a screaming, tyrannical executive making your life miserable, then you’re apparently out of luck.
Dreamworks shareholders, though, may be inclined to agree with the more classic model of the Hollywood executive over the last year, though. The company’s shares are off almost 35 percent in the last year with no dividend to cushion the blow. That adds to an over 40 percent slide over the last five years and a 56 percent decline since being spun off from Dreamworks in 2004.
NuStar (NS) Strikes Employee/Investor Balance
Coming in at number 15 on the Fortune list, this San Antonio, TX-basedcompany is engaged in the terminalling and storing of petroleum products. The company has never laid off a worker, pays all health insurance premiums, and matches 401K contributions up to 6 percent of salary. What’s more, in times of crisis, the company will lend employees the corporate jet. So now there’s a real upside to Great Aunt Gertrude’s untimely passing.
NuStar, though, is a bit more of a mixed bag to its shareholders. Over the last year, shares are down almost 14 percent. Over the last five years, they’re off just over 14 percent. However, given the fact that those time periods include a pretty choppy market and that NuStar is up over 50 percent over the last 10 years, it’s easier to bear that burden. That is especially true when one considers that hefty dividend yield of 7.63 percent that NuStar offers. It’s like emergency use of the corporate jet for shareholders.