How we pick the Fastest-Growing

To qualify, a company -- domestic or foreign -- must be trading on a major U.S. stock exchange; file quarterly reports to the SEC; have a minimum market capitalization of $250 million on June 30, 2009; have a stock price of at least $5 on June 30, 2009; have been trading continuously since June 30, 2006; have revenue and net income for the four quarters ended on or before April 30, 2009, of at least $50 million and $10 million, respectively; and have posted a compound annual growth in revenue and earnings per share of at least 20% annually over the three years ended April 30, 2009.

All companies that meet these criteria are ranked by their revenue growth rate; and their EPS growth rate; and their three-year annualized total return to investors for the period ended June 30, 2009. The overall rank is based on the sum of the three ranks. Once the 100 companies are identified, they are then re-ranked within the 100, using the three equally weighted variables. If there is a scoring tie, the company with the larger four-quarter revenue receives the higher rank.

To compute the revenue and EPS growth rates, FORTUNE uses a trailing four quarters log linear least square regression fit. Excluded are real estate investment trusts, limited partnerships, companies about to be acquired, and companies that lost money in the quarter ended May 31 or June 30, if data were available. The data from Zacks Investment Research are verified by FORTUNE using data provided by SunGard Fame, Standard & Poor’s Compustat, Hoover’s; Thomson Financial, and 10K Wizard.

Contacts

If you have further questions about the Fastest-Growing Companies, please e-mail lists@cnnmoney.com.

From the August 31, 2009 issue

Force Protection 195%
M & F Worldwide 110%
Sigma Designs 104%
Sigma Designs 338%
CF Industries Holdings 328%
DG FastChannel 308%
Green Mountain Coffee Roasters 88%
Ebix 77%
CF Industries Holdings 74%
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