Day: October 17, 2022

Animation: The Largest Public Companies by Market Cap (2000–2022)

This post is by Carmen Ang from Visual Capitalist

The Largest Public Companies by Market Cap (2000–2022)

The 10 largest public companies in the world had a combined market capitalization of nearly $12 trillion as of July 2022.

But two decades ago, the players that made up the list of the largest companies by market capitalization were radically different—and as the years ticked by, emerging megatrends and market sentiment have worked to shuffle the deck multiple times.

This racing bar chart by Truman Du shows how the ranking of the top 10 largest public companies has changed from 2000 to 2022.

Market Cap vs. Market Value

Before diving in, it’s worth noting that market capitalization is just one of many metrics that can be used to help value a company.

Simply put, a company’s market cap measures the combined price of a company’s outstanding shares—in other words, it’s the price someone would pay if they wanted to purchase the company outright at current stock prices (theoretically speaking).

But while a market cap provides insight into what equity is worth at a given time, calculating the market value is far more complicated and nuanced. After all, a price paid might not reflect the actual value of a business. To get a measure of value, other metrics like a company’s price-to-sales (P/S) ratio, price-to-earnings (P/E) ratio, or return-on-equity (ROE) may be considered.

The Largest Public Companies by Market Cap (2000–2022)

Over the last two decades, investor sentiment has shifted as different trends have played out, and the types of companies buoyed up by the market have changed as well.

For instance, tech and telecom companies were big in the very early 2000s, as investors got excited about the seemingly endless potential of the newly-introduced World Wide Web.

Largest Companies by Market Cap (January 1, 2000)

RankCompanyMarket Cap (Jan 1, 2000)
#1🇺🇸 Microsoft$606 billion
#2🇺🇸 General Electric$508 billion
#3🇯🇵 NTT Docomo$367 billion
#4🇺🇸 Cisco$352 billion
#5🇺🇸 Walmart$302 billion
#6🇺🇸 Intel$280 billion
#7🇯🇵 Nippon Telegraph$271 billion
#8🇫🇮 Nokia$219 billion
#9🇺🇸 Pfizer$206 billion
#10🇩🇪 Deutsche Telekom$197 billion

In the middle of the Dotcom bubble, investors were pouring money into internet-related tech startups. As PC and internet adoption picked up, investors hoped to “get in early” before these companies started to really turn a profit. This overzealous sentiment is reflected in the market capitalizations of public companies at the time, especially in the tech or telecom companies that were seen as benefitting from the internet boom.

Of course, the Dotcom bubble was not meant to last, and by January 2004 the top 10 list was looking much more diverse. At this time, Microsoft had lost the top spot to General Electric, which had a market cap of $309 billion. Then in the late 2000s, energy companies such as ExxonMobil, PetroChina, Gazprom, and BP took over the list as oil prices spiked well over $100 per barrel.

But fast forward to 2022, and we’ve come full circle, with Big Tech back in the limelight again.

Largest Companies by Market Cap (July 1, 2022)

RankCompanyMarket Cap (Jul 1, 2022)
#1🇸🇦 Saudi Aramco$2.27 trillion
#2🇺🇸 Apple$2.25 trillion
#3🇺🇸 Microsoft$1.94 trillion
#4🇺🇸 Alphabet$1.43 trillion
#5🇺🇸 Amazon$1.11 trillion
#6🇺🇸 Tesla$707 billion
#7🇺🇸 Berkshire Hathaway$612 billion
#8🇺🇸 United Health Group$485 billion
#9🇺🇸 Johnson & Johnson$472 billion
#10🇨🇳 Tencent$435 billion

Four of the five largest companies are in tech, and Tencent also cracks the list. Meanwhile, Tesla is classified as an automotive company, but it is thought of as an “internet of cars” company by many investors.

Big Picture Trends in the Top 10 by Market Cap List

YearDescriptionTop Company (Market Cap USD)Top 10 Description
2000Dotcom BubbleMicrosoft ($606B)Multiple tech/telecom companies in the mix
2004Post-BubbleGE ($309B)Diverse mix of companies by industry
2009Financial CrisisPetroChina ($367B)Six non-U.S. companies make the list
2014$100 OilApple ($560B)Last year of oil-dominated list; tech starts ascending
2022Big Tech EraAramco ($2,270B)*Tech accounts for 80% of Top 5 companies

*As of July 1, 2022. Since then, Saudi Aramco has been re-surpassed by Apple due to a reversal in oil prices.

Trending Downwards?

Amidst rising interest rates, crippling inflation, and political issues like the ongoing conflict in Ukraine, signs point towards a potential global recession. Tech companies fared well during the COVID-19 pandemic, but will likely not be immune to the impacts of a generalized economic slowdown.

It’ll be interesting to see how things pan out in 2023, and which companies (if any) will manage to stay on top throughout the turmoil.

The post Animation: The Largest Public Companies by Market Cap (2000–2022) appeared first on Visual Capitalist.

2022 Thomvest SaaS Benchmarks — Part I: Data Sources & Methodology

2022 Thomvest SaaS Benchmarks — Part I: Data Sources & Methodology

Why We Created (Yet Another) SaaS Benchmark & Our Compilation of Private Company Benchmarks

In this two-part series, we examine private company SaaS benchmarks. Part I explains why we created our benchmark and what we learned from other benchmarks. Part II presents our 2022 SaaS benchmarks and describes ways to operationalize them.

Why Another SaaS Benchmark?

Our portfolio companies and founders often ask, “what is top performance for companies like mine?”

It depends.

While “it depends” is arguably the most accurate answer (speaking as a former management consultant), more information can be distilled for making decisions. We value the clarity that comes from forming a perspective on top performance. In the first of this two-part blog, we share our process of formulation and output for median and top quartile performance.

Some may say we recreated the wheel. Many firms have published SaaS benchmarks in the last couple of years. Why create another?

We created our benchmark to overcome the challenge of comparing across benchmarks. Our goal is to provide a clear, relevant, and easy-to-use benchmark. We believe startup leaders and investors will find value in applying our benchmarks. We propose best practices to operationalize these benchmarks and guardrails for making decisions.

There is extensive publicly available knowledge on SaaS performance. From private to public, bootstrapped to venture-backed companies. The research is excellent. Scale VP wrote a book about their benchmarks.

We learned so much while reviewing these benchmarks that we decided to (Read more...)

Momentum Monday – The Downward Momentum Keeps Up.

This post is by Howard Lindzon from Howard Lindzon

As a reminder, Marketsmith (by Investor’s Business Daily) is now a sponsor of the weekly show. All the charts you have been seeing in the videos and will continue to see are from Marketsmith. They are offering my readers a three week trial for $19.95. Click this link if you would like to try it out.

Happy Monday.

This week will not be for the feint of heart.

The momentum remains negative and the earnings season is getting into full gear.

The indexes remain well below their 200 day moving averages and the US dollar keeps rising with rates. The rising US dollar is crushing stocks and putting pressure on countries outside the USA and rising rates are putting pressure on our own debt service payments at home.

Ivanhoff and I cover this and more in this weeks Momentum Monday. You can watch or listen right here (please subscribe) on YouTube. I have embedded it on the blog just below as well:

Here are Ivanhoff’s thoughts:

What a crazy week! It wasn’t a big surprise that both PPI and CPI came above estimates on both year-over-year and month-over-month basis. What was somewhat unexpected was the initial market reaction. Most stocks sold off hard in the pre-market on Thursday when the CPI news broke out. The second the market opened, all we saw was relentless dip buying all day. What started as short sellers taking some profits after the indexes went down multiple days in a row and gapped down; (Read more...)

Proving the proven part

Let's say I claim to have invented an entirely new kind of artillery which can it take out protected targets by firing a projectile up in the air and then letting gravity bring it down. If you challenge my claim and we are talking about the part where the projectile goes up, the burden of proof is on me. If we are talking about the part where the projectile comes down the burden of proof is on you. I don't have to offer any evidence whatsoever to show that projectiles propelled into the air at less than escape velocity will return to earth.

Admittedly, that's a really contrived example but the basic principle does come up, often involving important questions.

Let's take masks and covid. If you accept that aerosol transmission is a significant factor in the spread of a disease, then I don't need to offer any proof that properly used face masks will reduce that transmission. It doesn't matter if there are no clinical or even observational studies to show this. Given aerosol transmission, it is almost impossible to come up with a viable scenario where wearing surgical masks will not help to some degree.

In general, productive arguments always follow the burden of proof. This applies as much to those making claims as to those challenging them.

Let's say you applied for a government contract to build a "hyperloop" (Musk's hyperloop wasn't a maglev train. It was also so unworkable that all "hyperloop" companies quietly scrapped the (Read more...)