PNC Financial Services Group was the region's top performing company last year, ousting two-time defending champion U.S. Steel to claim the honor.

Seven performance factors were used to determine the Post-Gazette Top 50's overall winner: revenue, revenue growth, net income, net income growth, stock performance, market capitalization (a measure of a company's worth determined by multiplying its share price by the number of shares outstanding), and return on equity, a gauge that measures how effectively management deploys capital provided by shareholders.

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How we calculated the
Top 50 in Business

Figures for the Post-Gazette's Top 50 lists were derived from company reports, Bloomberg and Post-Gazette research.

Revenue, net income and return on equity data are based on the most recent fiscal year reports filed by each company, as of close of business March 10. In most cases, that is the 2009 calendar year.

Stock prices and price changes are for calendar year 2009. For companies that went public during 2009, the price change is based on their stock's initial offering price. Market capitalization, which is based on shares outstanding and stock price, was measured at the end of January.

For overall rankings, an average score was determined for each of the seven performance categories: revenue, revenue change, net income, net income change, stock price change, market capitalization and return on equity.

Those averages were subtracted from individual company scores in each category, with the difference divided by the standard deviation for each of the categories to give each company a weighted score in each category.

The weighted scores for each company in each category were then added up to determine the overall scores.

An identical procedure was followed to arrive at the growth rankings, using the categories of revenue change, net income change, stock price change and return on equity.

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PDF: Top Winners Overall

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The formula used to rank the Top 50 performers favors large companies such as PNC, which placed third a year ago. The Pittsburgh bank was No. 1 in revenue, revenue growth, net income and market cap. It finished No. 2 in net income growth. The growth reflects in parts reflects its purchase of beleaguered Cleveland bank National City at the end of 2008.

H.J. Heinz maintained second place while U.S. Steel tumbled to 43rd. The Grant Street steelmaker's $1.4 billion loss last year put it in last place in terms of net income. U.S. Steel also finished last in change in revenue.

Two smaller companies managed to crack the Top 10. Cranberry clothier rue21, the region's 27th largest public company by market cap, placed seventh while Portec Rail Products, which ranked 41st by market cap, placed ninth.

Rue21 is a newcomer to the rankings while Portec may not make the list next year. In February, Green Tree-based L.B. Foster announced plans to acquire the rail industry supplier. Boards of both companies have approved the proposal, but shareholders are challenging it in court. Foster was the region's 13th best-performing company last year, jumping from No. 40 the previous year.

Other repeat performers from last year's Top 10 are: coal and natural gas producer Consol Energy, which climbed four spots to No. 3; Cecil generic drug maker Mylan, which rose one spot to No. 5; and PPG Industries, which dropped two notches to sixth place.

In addition to rue21, three other companies cracked the Top 10 this year: Dick's Sporting Goods at No. 4, American Eagle Outfitters at No. 8 and Federated Investors at No. 10.

Besides U.S. Steel, four other companies dropped out of the Top 10: CNX Gas, Calgon Carbon, Wabtec and S&T Bancorp. The first three remained in the Top 24 while the Indiana, Pa. banker took the hardest fall, descending to 38th place vs. its 10th place finish a year ago.

Mastech Holdings, an iGate spinoff that is new to the list, finished one spot below S&T. The third newcomer to the Top 50, Education Management, finished 15th after going public in October.

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