Federal Reserve has aggressively tightened the trillion
dollar market cap club. This has caused tech stocks to plunge back to Earth in
2022, and has shaken up the membership of this club.
The four current members of this exclusive club are:
|
Company |
Sector |
Date Market Cap Hit $1T |
Market Cap (Nov 3, 2022) |
|
Apple (AAPL) |
Tech |
Aug 2, 2018 |
$2.21 trillion |
|
Aramco (2222) |
Energy |
Dec 11, 2019 |
$2.01 trillion |
|
Microsoft (MSFT) |
Tech |
Apr 25, 2019 |
$1.60 trillion |
|
Alphabet (GOOGL) |
Tech |
Jan 16, 2020 |
$1.08 trillion |
Aramco, Apple, and Microsoft are still well above the $1 trillion mark for now. It is probable that Alphabet’s trajectory could come out of this list if this situation does not change soon. Google has pointed out that the fall in crypto advertising has had a big impact on revenue. Also, ad budgets continue to drop down as economic uncertainty continues.
Here are the three former members who have seen their market
cap dip back below $1 trillion:
|
Company |
Sector |
Date Market Cap Hit $1T |
Market Cap (Nov 3, 2022) |
|
Amazon (AMZN) |
Tech/Retail |
Sep 4, 2018 |
$911 billion |
|
Tesla (TSLA) |
Automotive |
Oct 25, 2021 |
$675 billion |
|
Meta (META) |
Tech |
Jun 28, 2021 |
$236 billion |
Amazon recently became the most recent company to fall below
the 10-digit threshold. Amazon received an under par earnings report and forecasts
for spending less on this upcoming holiday season. In response to these
reports, the ecommerce giant has paused corporate hiring for the foreseeable
future.
Although Tesla’s evaluation has dipped in recent months,
Elon Musk remains confident on Tesla’s forecasts. He stated that the company
could ultimately be “worth more than Apple and Saudi Aramco combined”. To his
credit, Tesla reported record revenues last month.
Diverging Fortunes
Although Apple is down nearly 20% from its peak, the company
has managed better than its tech giant peers. In fact, Apple alone is now worth
as much as Meta, and Amazon, and Alphabet combined.
On the other hand, Meta is not only going through tough
times, it is the worst performer in the entire S&P 500 this year so far.
Investors are bearish on Mark Zuckerberg’s expensive leap of
faith that is the “metaverse” – a virtual reality world that people access via headsets
(e.g. Meta Quest). It is quite early to predict whether Meta is in the position
to be the next digital revolution, or embarking on one of the most expensive
tech flops in history.
Infographic by: visualcapitalist
