Our Picks for the Best CEOs of 2014

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It’s easy to hate CEOs.

Our Picks for the Best CEOs of 2014
Source: iStockphoto.com

Particularly their exorbitant salaries, perks and stock options — and even more so when missteps by high-profile corner office occupants like Sears Holdings Corp’s (SHLD) Eddie Lampert and United Technologies Corporation (UTX) chief Louis Chenevert led to their unceremonious exits in 2014.

Still, some CEOs deserve positive attention for doing a great job for their companies and shareholders.

So which CEOs posted the best performance in 2014?  Here are our picks: (in alphabetical order):

Best CEOs: Marc Benioff — Salesforce.com, inc. (CRM)

Best CEOs: Marc Benioff -- Salesforce.com, inc. (CRM)Back in 1999 when Mark Benioff founded Salesforce.com, inc. (CRM) as a cloud-based sales force automation company, few would have foreseen the seismic impact that software as a service (SaaS) and platform as a service (PaaS) could have within the enterprise.

But the self-made billionaire and philanthropist continues to think out of the box and can identify the next big thing for his company and the tech industry — cloud analytics. At a company event in October, Salesforce launched its Wave cloud analytics platform, which is the next step in the evolution of business intelligence and data analytics software.

Introducing the Wave, Benioff cited an International Business Machines Corp. (IBM) study that revealed 90% of all the data in the world has been created in the past two years — and that the volume of mobile data, unstructured data and product data will expand by orders of magnitude by 2020. He has made strong leadership decisions as well, such as hiring Oracle Corporation (ORCL) veteran Keith Block as president and vice chairman to shake up CRM’s upper management.

CRM will need a double helping of innovation in 2015 to turn back slowing sales growth and beat down competitive giants like Microsoft Corporation (MSFT). While Benioff has a daunting task ahead, his track record as one of the best and brightest is notable — and a big reason I wouldn’t bet against him.

Best CEOs: John Chambers, Cisco Systems, Inc. (CSCO)

Best CEOs: John Chambers, Cisco Systems, Inc. (CSCO)John Chambers of Cisco Systems, Inc. (CSCO) is the tech world’s Brett Favre: a phenomenally successful leader who spent nearly 20 years changing the way the game is played — and for the past several years sparking rampant speculation about when he will retire.

Although Chambers turned 65 last August, he can still make playoff-winning plays — like identifying and investing in the high-potential Internet of Things (IoT). Chambers remains fully committed to shrinking his company’s payroll, while leveraging investing in trends like smart cities, IoT, networking and Big Data analytics.

SCO’s so- called “Connected Analytics for the Internet of Everything” into being integrated into existing network gear — a move that could deliver big for the company in 2015. CSCO shares gained 26% in 2014 and the stock’s 2.8% current dividend yield is attractive, too.

Best CEOs: Tim Cook — Apple Inc. (AAPL)

Best CEOs: Tim Cook -- Apple Inc. (AAPL)For any CEO of Apple Inc. (AAPL), it was going to be an epic challenge to follow the iconic Steve Jobs — but Tim Cook has risen to the task over the past three years. It’s easy to see why some called Cook CEO of the Year in 2014.

First off, AAPL stock gained 38% in 2014 and the stock looks poised to continue to gain altitude in 2015. Second, Cook can take credit for the blockbuster launch of the iPhone 6, not to mention the push into mobile payments with its near-field communication-based Apple Pay.

Cook is a groundbreaking CEO who came out as the first openly gay Fortune 500 chief executive in 2014, and has met with civil rights activist Jesse Jackson on the issue of diversity.

Cook also is delivering results for shareholders — including a 1.7% current dividend yield and other strong fundamentals — including nearly $50 billion in free cash flow.

Best CEOs: Reed Hastings — Netflix, Inc. (NFLX)

Best CEOs: Reed Hastings --Netflix, Inc. (NFLX)Netflix Inc. (NFLX) cut Reed Hastings’ 2015 base salary from $3 million to $1 million in large part because of the performance of NFLX stock, which was down more 7% in 2014 after shares surged more than 300% in 2013.

No need for tears, however: Hastings’ stock options will increase from $3 million in 2014 to $13.7 million this year. That provides added incentive for Reed to treat NFLX shareholders right.

Last summer, Hastings survived a challenge from activist investors to split the chairman and CEO positions.

NFLX stock got hammered after the Qwixter debacle in 2011 when Netflix’s plan to boost revenues by splitting up its streaming video and DVD by mail elicited howls of protest from customers, while shareholders called for Hastings’ head on a pike.

Against tough odds, Hastings and NFLX not only survived, but invested in video streaming, developed original programming like House of Cards starring Kevin Spacey and set his sights on non-U.S. markets. Hastings also predicted that broadcast TV would be dead by 2030.

While NFLX still faces competitive headwinds, Hastings has worked wonders to revive a company that Wall Street left for dead less than two years ago.

Best CEOs: John Martin — Gilead Sciences, Inc. (GILD)

Best CEOs: John Martin -- Gilead Sciences, Inc. (GILD)Because they innovate on the bleeding edge, going all-in on biotech stocks is not for the faint of heart or light of wallet. That’s the value of having a CEO like Gilead Sciences, Inc.’s (GILD) John Martin on board.

The company’s blockbuster hepatitis C drug Sovaldi has churned out more than $8.5 billion in sales — despite howls of protest over the $1,000-per-pill price tag. The drug’s success stems from Martin’s acquisition of Pharmasset Inc. three years ago.

The company also has a strong and deep drug pipeline including advanced HIV treatments, and GILD gained FDA approval for Zydelig, its first cancer drug, in July.

Although GILD shares slid by more than 6% in December when Express Scripts Holding Company (ESRX) dropped coverage of the high-ticket drugs Sovaldi and Harvoni, Martin is poised to lead GILD even higher in 2015.

Best CEOs: Elon Musk –Tesla Motors Inc (TSLA), Space Exploration Technologies Corporation

Best CEOs: Elon Musk --Tesla Motors Inc (TSLA), Space Exploration Technologies CorporationElon Musk, the founder of both privately held Space Exploration Technologies Corporation (SpaceX) and electric car company Tesla Motors Inc (TSLA) is not one to rest on his laurels.

In 2014, Musk announced plans to build a $5 billion gigafactory in Nevada that will be able to produce some 500,000 lithium-ion battery packs for its upcoming mass-market electric car. TSLA stock gained 47% in 2014. TSLA also began delivering electric vehicles to China and Australia.

But there’s more to Musk than electric cars: the visionary that helped create residential solar provider SolarCity Corp (SCTY) in the U.S. is also in the rocket and launch services business — SpaceX won a $2.6 billion contract from NASA to deliver rockets by 2017.

While headwinds remain — most notably the impact cheap gas could have on electric vehicle sales — Musk has been a rock-star CEO and is likely to take his game to the next level in 2015.

Best CEOs: Doug Parker, American Airlines Group Inc (AAL)

Best CEOs: Doug Parker, American Airlines Group Inc (AAL)The airline sector is a notoriously hard place to make money, so it might buck conventional wisdom to see American Airlines Group Inc (AAL) CEO W. Douglas Parker beat out a perennial favorite like Amazon.com, Inc.’s (AMZN) Jeff Bezos.

Then again, Parker earned his reputation in December 2013 after successfully acquiring the old American Airlines out of bankruptcy and merging the legacy carrier into his own US Airways Group Inc.

But Parker also hit the ground running, moving the combined carrier to the Oneworld code-share alliance, which boasts strong global partners like British Airways, Japan Airlines Co Ltd and Qantas Airways.

He also has gone the extra mile in reaching out to labor unions — handing out surprise raises to all employees in December and giving flight attendants who had voted down a new contract proposal by only 16 votes the full $81 million AAL originally offered — not the substantially lower amount that the arbitration required the airline to pay.

While Parker’s airline faces some of the biggest integration challenges next year, investors are happy about AAL stock’s 115% performance in 2014.

Best CEOs: Meg Whitman — Hewlett-Packard Company (HPQ)

Best CEOs: Meg Whitman -- Hewlett-Packard Company (HPQ)How you inject new vision and value into a 75-year-old technology vendor? Simply divide and conquer.

And that’s what Meg Whitman, the former eBay Inc (EBAY) chief and unsuccessful California gubernatorial candidate has done with plans to split Hewlett-Packard Company (HPQ) into two publicly traded companies by the October, the end of HPQ’s fiscal year.

The split will create two highly focused units: computer hardware and printer unit HP Inc. and Hewlett Packard Enterprise, its business technology and services unit. Each unit would bring in annual revenue of about $58 billion.

Although HP’s hardware revenues will struggle in a software and cloud-driven world, Whitman continues to slash expenses and optimize HP’s competitive position in a rapidly changing tech world. HPQ stock has gained nearly 42% in 2014 — and its nominal current dividend yield of 1.7% are good news for shareholders.

As of this writing, Susan J. Aluise did not hold a position in any of the aforementioned securities.

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Article printed from InvestorPlace Media, https://investorplace.com/2015/01/best-ceos-2014-crm-csco-aapl-nflx-gild-tsla-aal-hpq/.

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