24/7 Wall St.

Apple (NASDAQ: AAPL) became the most valuable company in America yesterday when its market cap passed Exxon Mobil’s (NYSE: XOM). The move draws attention to what market capitalization means, and why it is important. The total value of a company is driven by market forces as investors fight over the value of a company’s assets, earnings, and future business prospects. The market cap of each company is skewed by how quickly the stock trades and within what range. At any time, one of the companies on this list could pass another if a stock moves enough. The list, therefore, is hardly permanent

24/7 Wall St. assembled a list of the ten most valuable companies in the U.S. We asked why they are on the list and whether their overall direction is up or down.

Read The Ten Most Valuable Companies In America

10. Procter & Gamble
> Market cap: $167 billion
> Current stock price: $59
> 52 week high/low: $68/$57
> Industry: consumer products

P&G is the world’s largest consumer product company and does business in over 100 countries. Its broad array of products ranges from razors to soap to skin care. The company’s margins have been challenged with the rise of certain commodities prices, but management claims that most of this can be offset by increasing what it charges for its products. The prices of most commodities have leveled off in the last two months. P&G has a number of small competitors like Colgate, but none have been able to take meaningful share from the market leader. P&G trades in a 52-week price range of $68 to $57. It changes hands at $59 and will probably remain at that low level until it is clear that the consumer economy has recovered.

9. AT&T
> Market cap: $167 billion
> Current stock price: $28
> 52 week high/low: $32/$26
> Industry: telecommunications

AT&T is one of the largest telecom companies in the world, and it has huge franchises in wire line phones, cellular service, and fiber to the home. The last business competes with cable TV. AT&T’s wire line business shrinks with every customer who cancels his or her home phone service and moves to cellular or VoIP products. The cellular business has become more competitive as the number of U.S. customers reaches a saturation point. AT&T has tried to solve those problems via a buyout of T-Mobile, which would make AT&T the largest wireless company in the U.S. The company trades in a 52-week price range of $32 to $26 and trades now at $28. The company’s stock will stay under pressure until the T-Mobile deal closes. Even then, AT&T still has to face the rapid loss of home phone users.

8. Berkshire Hathaway
> Market cap: $170 billion
> Current stock price: $68
> 52 week high/low: $87/$66
> Industry: conglomerate

Warren Buffett’s conglomerate owns everything from railroads to newspapers to insurance companies. Part of the company’s appeal to Wall St. is the fact that Warren Buffett’s investing track record over the last 30 years is unequaled. Buffett tends to be a long-term investor and has held positions in corporations like Coca Cola for years. One of the major concerns about the company is that Buffett is 80 years old. The day he leaves, the shares are likely to tumble. The stock trades in 52-week range of $87 to $66. Shares are now at $68 on concerns that Buffett’s wide range of companies has exposure across the entire economy, and his insurance companies have investments in derivatives.

7. Wal-Mart
> Market cap: $171.bilion
> Current stock price: $50
> 52 week high/low: $58/$49
> Industry: retail

The world’s largest retailer has sales of $415 billion, and is the biggest single employer in the U.S. Wal-Mart has struggled mightily with stalled sales in the U.S. where it competes with Target, Costco, and Sears. Its overseas sales have been up sharply, mostly because of success in China and Mexico. Wal-Mart faces some cost pressures. Among these is the possibility that the company will be unionized in the U.S. The stock trades in a 52-week price range of $58 and $49. It trades at $50 on worries about a recession — one that could kill retail demand — and its struggles in the U.S. The stock will continue to trend lower if same-store sales in America do not improve.

6. Google
> Market cap: $180 billion
> Current stock price: $560
> 52 week high/low: $642/$447
> Industry: Internet

Google’s shares have been helped this year by a surge in sales and profits. The company still dominates the search engine market and has nearly three quarters of this business in the U.S. and most of Europe. Its position in big countries like China, India, and Russia is weaker. The market’s main complaint about Google is that it has continued to make huge investments in personnel and in products that are not profitable. The stock’s 52-week price range is $642 and $447. It trades at $560 now and profit momentum should move that number up.

5. Chevron
> Market cap: $183 billion
> Current stock price: $91
> 52 week high/low: $109/$72
> Industry: oil

Chevron is essentially a smaller version of Exxon with both large exploration and refining operations. Investors have largely applauded the company’s move into the natural gas business. Current concerns around the company are that the International Energy Agency has recently said oil demand will be down over the next year. That means money for exploration may not enjoy a rapid return. Chevron made $11 billion last quarter and has a huge cash balance. Its 52-week price range is $109 to $72. It trades at $91 and the momentum is likely to drop with oil prices.

4. IBM
> Market cap: $200 billion
> Current stock price: $167
> 52 week high/low: $185/$122
> Industry: technology

IBM is to enterprise computing what Microsoft is to personal computing. IBM has diversified out of its traditional hardware business into services, software, and financing of customer purchases. IBM has also been able to slash its employee base and export jobs to places like India and China. Solid product management has allowed the company to push past traditional rival like HP. The stock has a 52-week price range of $185 to $122 and trades at $167 now. The company’s recent improvement in earnings means that the price momentum on the shares is up.

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3. Microsoft
> Market cap: $206 billion
> Current stock price: $24.55
> 52 week high/low: $29.50/$23.30
> Industry: software

Microsoft was the No.1 company by market cap a decade ago. The stock has been frozen at 2001 levels for 10 years. The market’s trouble with Microsoft is that it has diversified into non-core business, including game console and search. Meanwhile, the company’s core software businesses are under assault by cloud computing businesses from companies like Google. The stock’s 52- week price range is $29.50 to $23.30. Shares trade at $24.55 now. If the last decade is any indication, Microsoft’s market cap is likely to stay where it is.

2. Exxon Mobil
> Market cap: $330 billion
> Current stock price: $68.03
> 52 week high/low: $88/$58
> Industry: oil

Exxon is the world largest oil company, and in a good quarter it can make over $10 billion in net income. The rise and fall of its market cap value is tied to some extent to the price of oil. The stock trades at $70, and its 52-week price range is $88 to $58. Its movement in the next few months is likely to be down as crude presses lower.

1. Apple
> Market cap: $337 billion
> Current stock price: $363.69
> 52 week high/low: $404/$235
> Industry: consumer electronics

As its stock has moved up 125% over two years, Apple has leapt over the other companies on the top 10 list. Apple’s strength, as far as the market is concerned, is that its sales nearly double in some quarters. Revenue is up to $100 billion and profits are over $11 billion a quarter, which matches Exxon. Apple’s product introduction cycle and the high regard analysts have for the company make it likely shares will rise sharply over the next year. The stock has traded in a 52-week price range of $404 and $235. It currently trades at $368.

Douglas A. McIntyre