Two years ago, it was unimaginable that any company could have a market cap of over $1 trillion. In August 2018, Apple topped that number. Now, despite the effect of the pandemic on stocks, three public corporations have market values over $1 trillion. Another is near that level.
Most investors would argue that the extraordinary market capitalizations of Microsoft (NASDAQ: MSFT), Amazon.com (NASDAQ: AMZN), and Apple (NASDAQ: AAPL) are because of the dominance each has in its sector of the business world. It is the only compelling argument for the $1 trillion valuations. The same can be said of Alphabet (NASDAQ: GOOGL) the parent of Google, with a market value just below the $1 trillion level.
The stocks of each have bettered the market in the last three months of unsettled trading. The S&P 500 is up less than 3%. Amazon is higher by 30%, Apple by 16%, Microsoft by 13%, and Alphabet by 7%.
Microsoft’s market cap is $1.4 billion, followed by Apple and $1.37 billion, and Amazon at $1.22 billion. Alphabet’s is $977 billion.
Microsoft continues to be one of the major stories in turnarounds of big companies. It has gone from being a business and personal software company to a dominant position in the huge cloud computing business.
Apple, despite a dip in iPhone sales, is expected to dominate the new 5G smartphone market. Its services business which does not have the manufacturing costs of the iPhone, Watch, Mac, or iPad, is the company’s fastest-growing segment.
Amazon exerted and expanding its portion in the retail market as most bricks-and-mortar retailers suffered the effects of stay at home orders due to the spread of COVID-19. It is also the largest player in the cloud business.
Alphabet’s Google continues to be the world’s largest search engine by far. While much of the global ad market is shrinking, Google’s revenue continues to grow
The number of $1 trillion market cap companies may well grow from three to four in the very near future.
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