THE LARGEST COMPANY IN THE WORLD

I was reading the latest TIME of the 100 most influential companies and saw a note that Tesla's market cap was around $700 billion, while General Motors was under $100 billion.  Turns out that today this figure for Tesla is $567 billion, even though General Motors sold 6.8 million cars in 2020 while Tesla only sold half a million.  Part of this market cap value is the stock value of the company, and GE sold 8.5 million vehicles in 2018.  You got to wonder if Tesla is monstrously overvalued.  If you were wondering why Reese Witherspoon was on the cover, her company has been really influential.

Later, I saw that one with even fewer assets, Facebook, had a market cap of $890 billion.  What is market cap?  Simply, multiply the total number of outstanding shares by the current market price.  Has nothing to do with what they are really worth.

Then, I saw that Tencent, a Chinese company, is the most valuable company in Asia with a worth of $750 billion.  However, worth is different from cap.  Market value uses numerous metrics such as price-to-earnings, price-to-sales and return-on-equity.  Other factors such as outstanding bonds, long-term growth potential, corporate debt, taxes and interest payments are cranked into the worth.

Of course there is a third term again different from the other two:  book value.  Calculate by subtracting non-monetary assets and liabilities or debts from a company's total assets.

So I went to Statista, and saw the following ranked by market capitalization in 2020:

• #1   $1645 billion   Saudi Aramco (Saudi Arabia)
• #2   $1359 billion   Microsoft (USA)
• #3   $1286 billion   Apple (USA)
• #4   $1233 billion   Amazon (USA)
• #5   $  919 billion   Alphabet (USA--parent company of Google)
• #6   $  584 billion   Facebook (USA)
• #7   $  545 billion   Alibaba (China)
• #8   $  510 billion   Tencent (China)
• #9   $  455 billion   Berkshire Hathaway (USA, Warren Buffet)
• #10 $  395 billion   Johnson & Johnson (USA, one of those vaccine companies)

Well, what about the largest by annual revenues (with market cap shown in parentheses)?

• #1   $542 billion   Walmart ($393 billion)
• #2   $356 billion   China Petroleum & Chemical Corp ($54 billion)
• #3   $322 billion   Amazon ($1.6 trillion)
• #4   $320 billion   PetroChina ($59 billion)
• #5   $274 billion   Apple ($2 trillion)
• #6   $264 billion   CVS ($77 billion)
• #7   $263 billion   Royal Dutch Shell ($110 billion)
• #8   $260 billion   Berkshire Hathaway($520 billion)
• #9   $249 billion   Toyota Motor Corp ($182.7 billion)
• #10 $247 billion   Volkswagen ($95 billion)

Why are the market caps different?  Depends on the value of the stock.  Today, for example, here are the largest by market cap:

• #1   $2.1 trillion   Apple
• #2   $1.9 trillion   Saudi Aramco
• #3   $1.8 trillion   Microsoft
• #10 $0.5 trillion   Tesla
• #15 $0.4 trillion   Johnson&Johnson
• #16 $0.4 trillion   Walmart
• #31 $0.3 trillion   Exxon Mobil
• #40 $0.2 trillion   Toyota
• 100 $0.1 trillion   SoftBank

So which is the largest in the world?  It depends.

Finally, Forbes this week had an article on how the world's biggest companies endured the pandemic.  First, amazingly enough, the world stock market has JUMPED 48% in the past year.  They list 100 companies by country, sales, profit, assets and market value.  They had the following ranking:

• #1     Industrial and Commercial Bank of China
• #2     JPMorgan Chase
• #3     Berkshire Hathaway
• #4     China Construction Bank
• #5     Saudi Aramco
• #6     Apple
• #6     Bank of America
• #6     Ping An Insurance
• #9     Agriculture Bank of China
• #10   Amazon

In terms of parameters:

• ICBC at #1  had the most assets = $4.9 trillion
• Walmart at #18 had the largest sales figure = $556 billion
• Apple at #6 had the biggest profit = $64 billion
• Apple at #6 had the highest market value = $2.2 trillion

Tesla is not in the top 100, while General Motors is #47 with:

• Sales = $123 billion
• Profit =$6.4 billion
• Assets =$235 billion
• Market value = $84.6 billion

Here is a tribute to policemen by Paul Harvey, who passed away more than a decade ago:

Quizas (Perhaps) with Andrea Bocelli and Jeniffer Lopez.  The original in 1947 was by Bobby Capo.  I best remember the version by Nat King Cole.

-