Big Tech Just Keeps Getting Bigger
It’s becoming increasingly difficult to wrap your head around just how massive some big tech stocks are getting, especially since they keep outdoing themselves.
The pandemic has pushed even more activity online, and the FAATMAN stocks (Facebook, Amazon, Apple, Tesla, Microsoft, Alphabet, and Netflix) have benefited immensely.
With many of these companies experiencing record breaking quarters, how much revenue do the big tech stocks generate per minute?
|Company||Revenue Per Minute||Market Cap ($B)|
Data as of March 2021. Revenue per minute figures based off SEC filings, and market caps from Seeking Alpha.
Milestones Across The Board
Facebook continues to face considerable headwinds as privacy matters garner more political attention. But this is yet to have any material effect on the business.
Their most recent quarter was a company best, generating $27 billion in revenue, and hosting an average of 2.8 billion monthly-active-users (MAUs) on the flagship platform.
Alphabet, the parent company of Google, is a behemoth. They finished 2020 with $182 billion in revenues, with approximately $20 billion coming from YouTube.
Furthermore, almost 4 billion Google searches occur every single day, making it the most popular website in the world.
Although the U.S. remains their most prominent market, Amazon does considerably well in other parts of the world. For example, in 2020 they generated $20 billion in revenues from Japan, and $29 billion from Germany.
The growing EV narrative is a large part of what’s driven Tesla to new heights. The company graduated to the prestigious S&P 500, and along the way has made Elon Musk among the richest people in the world.
Microsoft is the second largest Big Tech stock with a whopping market cap of $1.75 trillion. Their diversified business holdings include Bing, LinkedIn, Xbox, and their cloud computing service Azure.
Apple is no longer just about the iPhone. In the first quarter of 2021, Apple’s services segment of the business made $15.7 billion in revenue, greater than both Mac and iPad, which each contributed about $8 billion to the business. In addition, their wearables, home, and accessories category made $12.9 billion in revenue.
The pandemic has been kind to Netflix and Reed Hastings. The streaming giant wrapped up 2020 adding 52 million new subscribers—taking the total tally to 203 million.
Netflix’s breadth of content routinely dominates the Golden Globe awards. And with 42 nominations in 2021, this year was no exception. Their original content is a driving factor behind the impressive subscriber growth and revenue generation.
No End In Sight
The combined market cap of the FAATMAN stocks is now over $8 trillion. To put it into perspective, that’s about equivalent to Germany, Canada, and France’s GDP combined.
Despite their gigantic valuations, the growing topline figures from their SEC filings suggests they are not done yet. So while the current value may appear bloated, no one can quite rule out FAATMAN getting fatter.
Here’s What $1,000 Invested in Vaccine Stocks Would Be Worth Now
Ever wonder what you would have gotten if you invested $1,000 into the different vaccine stocks at the start of the pandemic?
Vaccine Stocks During a Pandemic
It’s often said that with every crisis comes great opportunity.
While such catastrophes do create upheaval and uncertainty in financial markets, they can also lead to new opportunities for investors, as asset classes react to different environments.
Since the World Health Organization (WHO) declared COVID-19 to be a pandemic on March 11, 2020, the performance of vaccine stocks have been varied—but with some notable winners that notched triple or quadruple digit returns.
Here’s how much a $1,000 investment would be worth as of March 31, 2021, if you had put money into each vaccine stock at the start of the pandemic:
|Stock||Value of Investment||% Growth||Market Cap ($B)|
|Johnson & Johnson||$1,252||25.2%||$419.8|
The Business of Vaccines
The returns on vaccine stocks have varied greatly. They are staggering in the case of Novavax and Moderna, but also seem quite underwhelming, when considering the likes of Sanofi, AstraZeneca, and Pfizer.
One factor for the discrepancy in stock price performance is the revenue potential from vaccine sales relative to the rest of the existing business, as vaccine sales will have a much greater impact on the fundamentals of smaller companies.
For example, before the pandemic, Novavax had revenues of just $18.7 million—this meant that capturing any portion of global vaccine sales would create massive value for shareholders. On the flipside, vaccine sales are much less likely to impact the fundamentals of Sanofi’s business, since the company already is generating $40.5 billion in revenue.
To put it into perspective, analysts are expecting total sales from COVID-19 vaccines to be around $100 billion, with $40 billion in post-tax profits.
Vaccine Stocks vs the S&P 500
Even in a booming and valuable industry, it’s difficult to identify the long-term leaders. For example, in the mobile phone market, there was a time where the likes of Motorola, Nokia, and Blackberry appeared untouchable, but eventually lost out.
Similarly, with the limited information available at the start of the pandemic, few, if any, could have separated the winners and losers from this group with accuracy.
In the past year, the S&P 500 grew 44.9%—meaning that only three of the seven vaccine stocks have seen their share prices outperform the market.
Nobody said helping solve a global pandemic guarantees a pay off.
Bitcoin is the Fastest Asset to Reach a $1 Trillion Market Cap
Bitcoin is now part of a select very few assets that hold a market cap greater than $1 trillion. How long did it take to get there?
Bitcoin is the Fastest Asset to Reach $1 Trillion
The world is moving forward at an accelerated pace. Historically, it’s taken multiple decades for companies to be worth $1 trillion. For bitcoin, it took just 12 short years to reach such a milestone.
To help put things into perspective, here’s a look at how long it took America’s biggest tech companies to reach the $1 trillion market cap.
|Asset||Time To Reach $1 Trillion||Current Market Cap|
|Microsoft||44 years||$1.9 trillion|
|Apple||42 years||$2.2 trillion|
|Amazon||24 years||$1.7 trillion|
|21 years||$1.5 trillion|
|Bitcoin||12 years||$1.1 trillion|
Market caps as of April 12, 2021
Extreme Bullish Sentiment
Bitcoin has been subject to widespread commotion in markets.
At the start of 2021, the cryptocurrency had a more modest market cap of $500 billion, but has gained more than another $500 billion since. An onslaught of headlines has contributed to extremely bullish investor sentiment, including:
1. CEOs begin to show interest
Elon Musk and Jack Dorsey have made sizable investments in bitcoin through Tesla and Square, respectively. It’s estimated the gain from Tesla’s $1.5 billion bitcoin investment was greater than the profits from the entirety of their business in 2020.
2. New ETFs on the block
Multiple Bitcoin ETFs focused were recently approved by Canadian regulators and some have already launched on the Toronto Stock Exchange (TSX). For many years, the Grayscale Bitcoin Trust (GBTC) was the only readily accessible investment vehicle trading on equity markets that had exposure to BTC.
3. Financial institutions finally joining in?
Mastercard, Visa, and Bank of New York Mellon have made announcements to make it easier for customers to use cryptocurrencies.
On to the Next Trillion?
Future projections for the price of bitcoin are garnering more extreme and widening price targets.
The accelerated rate of change today has many of the Big Tech companies already inching closer to the next trillion in value. Will bitcoin follow suit?
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