Kroll analyzed a price-weighted index of Chicago’s 30 largest publicly traded companies by market capitalization (the CHI30). The Dow Jones Industrial Average (DJIA) is comprised of diversified companies and some of the largest in the U.S. ($204 billion median market cap vs. $28 billion median market cap of CHI30).
Key highlights from the report:
- The CHI30 price-weighted index increased by 9.9% in the year-to-date (YTD) period through December 31, 2020, compared to the DJIA’s gain of 7.2%.
- The CHI30 declined 40.7% from February 12 through March 23, 2020 while the DJIA declined 37.1%, as the outlook at the onset of the COVID-19 pandemic was bleak for industrials. During the final four months of 2020, the CHI30 increased 16.1%, compared to the DJIA increase of 6.8%, due to the recovery of the middle-market, which the CHI30 services.
- The CHI30 is more concentrated in industrials (42.8%) than the DJIA (17.2%), while the DJIA has more exposure to information technology (20.2%) than the CHI30 (16.0%).
- Since the beginning of the year, the DJIA “leaders” averaged gains of 53.8%, while the CHI30 “leaders” averaged increases of only 45.6%. Similarly, DJIA “laggards” averaged a decline of 32.2%, compared to the CHI30 “laggards,” who averaged a decline of 39.2%. However, the average increase in stock price for companies in the CHI30 index was 7.9%, while the average increase in stock price for companies in the DJIA was only 2.7%.
- The CHI30 performed worse on financial metrics in Q2 2020. The CHI30 had an average revenue decline of 8.0% compared to Q2 2019, while the DJIA had an average decline of 6.9%. The CHI30 had an average EBITDA margin decline of 11.1% while the DJIA had an average decline of 4.7%.
- The CHI30 had a stronger recovery in Q3 2020 than the DJIA. The CHI30 had an average revenue increase of 13.2% compared to Q2 2020 while the DJIA had an average increase of 10.0%. The CHI30 had an average EBITDA margin increase of 7.9% while the DJIA had an average increase of 5.2%.
- Oak Street Health was added to the CHI30 after its IPO in August 2020, posting a 52.9% increase in stock price from IPO to year-end.
The CHI30 performed worse than the DJIA on most Q2 financial performance metrics, but CHI30 companies performed better than the DJIA in Q3
The CHI30 is overweight in industrials and underweight in information technology, healthcare and communication services.