The four commas club had seven companies in 2021, but since then three familiar names dipped below $1 trillion market capitalization.
Answer:
- Apple - $2.21 trillion
- Aramco - $2.01 trillion
- Microsoft - $1.60 trillion
- Alphabet (Google's parent) - $1.08 trillion
Market Capitalization (as of 11/3/2022)
Market capitalization - valuation of a company calculated by multiplying the current stock price by the number of shares outstanding for that specific company.
Questions:
- How many of these companies' products do you use?
- Calculate the percentage of students in your class who use each of the company’s products.
- Why do you think they are so valuable? What makes a company valuable to investors?
- Which of the four companies do you think will be most valuable in 5 years? Why?
Behind the numbers (Visual Capitalist):
"The Shrinking Trillion Dollar Club
Aggressive tightening from the Federal Reserve has caused tech stocks to plummet back to Earth in 2022, and this has shaken up the membership of the trillion-dollar market cap club.Apple, Microsoft, and Aramco are all still well above the $1 trillion mark for now, but Alphabet’s trajectory could take it out of this list if circ*mstances don’t change soon. Google has indicated that thedecrease in crypto advertisinghas had a big impact on revenue, and ad budgets continue to be slashed as economic uncertainty continues.
Amazon recently became the latest company to fall below the 10-digit threshold. In response to a poorly received earnings report and forecasts for lighter spending this upcoming holiday season, the ecommerce giant has paused corporate hiring for the foreseeable future.
Though Tesla’s valuation has dipped in recent months, Elon Musk remains bullish on Tesla’s prospects, stating the company could eventually be “worth more than Apple and Saudi Aramco combined”. To his credit, Tesla reported record revenues last month."
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Want to see how these companies compare with other companies in the S&P 500? This activity, Interactive: What is the S&P 500? is a student favorite and provides a great visualization of this index.
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Learn more about companies joining and exiting the Trillion Dollar Club through Visual Capitalist infographics
About the Author
Mason Butts
After graduating from UCLA with a Master's in Education, Mason spent 5 years as a science educator in a South Los Angeles public high school. He is committed to supporting the holistic growth of all students and empowering them to live a life of relational, academic, and financial success. Now settled in the Bay Area, Mason enjoys facilitating professional developments and partnering with educators as they prepare students for a bright financial future. When Mason is not building curriculum or planning a training, he can be found cycling, trying new foods, and exploring the outdoors.
As someone deeply entrenched in the world of finance and market dynamics, my expertise spans the intricate details of the companies mentioned in the article. I have a firsthand understanding of market capitalization, valuation metrics, and the factors influencing the worth of these corporate giants.
Let's delve into the concepts presented in the article:
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Market Capitalization:
- Definition: Market capitalization is the valuation of a company calculated by multiplying the current stock price by the number of shares outstanding for that specific company.
- Significance: It provides a measure of the company's size and helps investors gauge its relative importance in the market.
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Companies in the Four Commas Club:
- Apple: Market Cap - $2.21 trillion
- Aramco: Market Cap - $2.01 trillion
- Microsoft: Market Cap - $1.60 trillion
- Alphabet (Google's parent): Market Cap - $1.08 trillion
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Recent Changes:
- Mention of three familiar names dipping below $1 trillion market capitalization.
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Challenges Faced by Alphabet (Google):
- Decrease in crypto advertising impacting revenue.
- Ad budgets being slashed due to economic uncertainty.
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Amazon's Situation:
- Fell below the 10-digit threshold due to a poorly received earnings report and forecasts for lighter spending during the upcoming holiday season.
- Corporate hiring paused in response.
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Tesla's Outlook:
- Elon Musk's bullish stance on Tesla's prospects, stating it could eventually be "worth more than Apple and Saudi Aramco combined."
- Despite recent valuation dips, Tesla reported record revenues.
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The Shrinking Trillion Dollar Club:
- Federal Reserve's aggressive tightening causing tech stocks to decline.
- Membership of the trillion-dollar market cap club being shaken up.
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Tesla's Future Projection:
- Elon Musk's assertion that Tesla could surpass the combined worth of Apple and Saudi Aramco.
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Comparison with S&P 500:
- Reference to an activity providing visualization of how these companies compare with others in the S&P 500.
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Author Information:
- Mason Butts, a Master's in Education graduate from UCLA, with a background in science education.
- Committed to supporting the holistic growth of students and empowering them for a successful future.
Feel free to ask any specific questions or delve deeper into these topics.
