Who will get there first?
Alphabet (GOOGL) knocked it out of the park with earnings last night and are jumping over $50 higher (5%) after last night's earnings report and that will take them to just under $900Bn but still behind AAPL at $941Bn but now firmly ahead of AMZN ($875Bn) and MSFT ($830Bn) in the race to become the World's first Trillion Dollar Company.
As you can see from this chart, throw in Facebook and the top 5 S&P companies have the market capitalization of the bottom 282 – the difference between mega-caps and what we used to call large-caps has never been greater but it mirrors the more uneven distribution of wealth in our society where the people in the Top 10% THINK they are doing well, only because they really can't comprehend the wealth of the Top 0.01%, which starts at 1,000 times more than they make and 3,000 more than they own.
These Monster Companies, just like our Monster Billionaires can throw their money around and buy almost anything and get away with almost anything like Monopolizing On-Line Retail, Using Your Personal Information to make a Profit or even becoming President of the United States. It is truly terrifying to think of what kind of damage a bad Billionaire could do but thank goodness the US has a system of checks and balances that…. oops…
Oh well, if you can't beat them – invest in them, I guess. To that end, Alphabet (GOOGL) just beat earnings by $2.21/share, coming in at $11.75 per $1,211 share, now $1,262 in pre-market. If we assume they keep it up and make $46 for the year, then $1,262/46 is 27 times earnings, which is a lot, but maybe not for a company that made $32/share last year so about 40% bottom-line growth is not all tax cuts – this company is a MONSTER!
GOOGLE barely pulled back when the EU fined them $5Bn for engaging in anti-competitive behavior for giving Android away at a loss but GOOGL's solution will be to charge for Android and PRESTO!, they make much more than $5Bn installing an operating system on 1.3Bn phones – even if they just charge manufacturers $10 ($13Bn). Giving Android away…
