On August 2nd, 2018, Apple (NASDAQ:AAPL) made history by becoming the first publicly-traded company ever to attain a market capitalization of one trillion US dollars. And the one inevitable thing about firsts is that they’re soon followed by seconds and thirds. But who will be the next member of the One Trillion Dollar club, and should you be buying them now?
To be fair, Apple wasn’t actually the very first company to cross the one trillion USD threshold as that honor officially goes to Chinese energy company PetroChina that reached a trillion USD market cap over ten years ago during its Shanghai debut. However, the company has since met troubled times and its valuation has fallen dramatically in recent years and currently stands with a market cap around 25% of that value.
But, back to Apple. Its moment in the sun occurred when it closed above the 207.04 USD threshold, which, with a share count of 4.83 billion shares, brought it to reach the magic number of one trillion USD. This price followed Apple’s better-than-expected quarterly results when the Company projected an optimistic forecast for its September quarter, which is the time when it has traditionally announced new Apple iPhone models. In the two days leading up to its record-breaking result, the Company added a staggering sum of 82 Billion USD to break the one trillion USD mark. The 15% rise in the Dow Jones over the past 12 months has contributed to the market valuation of many of the world’s top publicly-traded technology companies. Apple’s valuation has risen by more than twice that amount at 32% in the same period.
Hard on the heels of Apple’s announcement came Amazon (NASDAQ:AMZN) who were trying to beat Apple to the post. However, with its own market cap sitting at only 873 billion USD, it didn’t quite make the grade. Google, with its own market cap of 849 billion USD came a close third in the three-horse race.
However, even Apple stands in the shadow of Saudi Arabian oil colossus Saudi Aramco, which was recently quoted as having a valuation in excess of two trillion USD, but this company is still privately owned, and so really couldn’t be considered as a real contender in the elite club. However, with plans to go public in 2019, the oil giant will put even the likes of Apple and Amazon in the shadow with its financial muscle.
Future 1Tn club members include technology giants Alphabet (NASDAQ:GOOGL) (Google), Microsoft (NASDAQ:MSFT), and Amazon, each of which has crossed 800 billion USD market cap valuations, and which should be bought now as the stock market sits in its current consolidation range. Behind these companies comes Chinese multinational investment company Tencent Holdings Ltd ADR (OTC:TCEHY), Berkshire Hathaway (NYSE:BRKa), and the Alibaba (NYSE:BABA) group, each with market caps around the half trillion USD mark. History has shown that the larger the company, the greater the chance it will outperform the underlying market index, under positive market conditions. And, with current market sentiment increasingly bullish, if you don’t have these tech companies in your portfolio, this could be as good a time as any to “ship them in”.