By Stephen Evans BBC North America business correspondent

Wal-Mart: Still piling on the sales

Last week, some readers queried Stephen Evans' assertion that Wal-Mart was the world's biggest company. What did he mean? we were asked. Here's his reply.

Journalists love superlatives. Saying something is the biggest or the oldest or the most-profitable in the world, or "ever", gives a story just that little boost it needs to secure greater prominence on the page.

A true rendition of facts about the second-biggest company in the world or the second-richest man doesn't have the same oomph that the number one has.

But we know the dangers, too. We've had our knuckles rapped too often by that alert reader who could contradict the claim with the sort of detail only mastered by (how can I put this politely?) the true expert.

Defining a company as "the biggest in the world" is essentially a journalistic device. To say a company is the biggest is short hand for saying that it matters a great deal indeed

So we love superlatives - but we also fear them. Like a dog who's been scratched by a cat, we go forward warily in particular areas.

In Britain, it is a rash reporter who opines on species of birds or types of steam engine or regimental uniforms.

Other countries no doubt have their own journalistic "proceed with caution" areas. There will always be someone to fall on the tiniest error.

So it is with superlatives. Which company, for example, is the world's biggest?

We always say it's Wal-Mart, and it becomes an automatic, almost as if there were an F-key that inserts the phrase "world's biggest company" once Wal-Mart's been mentioned.

Company value

If you put that phrase into a data-base of the English-speaking world's biggest, er, I mean most-famous newspapers, a variety of answers come up.

Take this from the Evening Standard in London for 10 May this year: "Oil major Exxon Mobil is poised to overtake General Electric as the world's biggest company if oil prices continue to surge".

Sales for 2003 Wal-Mart - $256bn Exxon - $247bn GE - $134bn

Similarly the Straits Times of 25 April opts for GE as the "world's biggest company". So does the South China Morning Post of 27 February.

And yet the Los Angeles Times of 13 May opts for Wal-Mart, as does the Economist of 17 April and Irish Times of 20 February.

They're all correct, of course. It depends what you're measuring.

Market capitalisation GE - $321bn Exxon - $280bn Wal-Mart - $236bn

Those who reject Wal-Mart as the biggest use the value of the company on the stock market - basically, the price of the shares multiplied by their number - which means that rising oil prices, prompting rising share prices in oil companies, push Exxon up the list.

Wal-Mart, on the other hand, gets the vote because its revenue exceeds that of any other company.

Dotcom boom

So who's right? Everybody and nobody. Measuring a company by stock market valuation throws up absurdities. As we see with the Exxon-GE comparison, it can change by the day.

GE: Keeping Exxon at bay despite oil price surge

And during the great dot-com boom, some highly unprofitable companies gained great prominence on this measure.

The case of Priceline.com has been well told by John Cassidy in his book "Dot.con". This company selling tickets for airlines was worth at one stage more than most of the actual airlines themselves.

Was it therefore bigger? Of course not. It owned a few powerful computers and a brand-name yet it could hardly be said to be bigger than a good chunk of the whole industry which owned aircraft and terminals - and made profits.

Legitimate measures

So perhaps profitability should come into the measure. Which, then, is the world's most profitable company?

According to London newspaper the Observer of 1 February, it is Microsoft.

According to the Irish Times of 9 December last year, "Citigroup has become the world's most profitable company". Business Week of 28 July agreed.

None of this is to make a cheap point. All the measures used are legitimate. All tell a true picture.

But defining a company as "the biggest in the world" is essentially a journalistic device. To say a company is the biggest is short hand for saying that it matters a great deal indeed!