Alphabet becomes the fourth U.S. company to enter the trillion dollar club
Alphabet Inc, the parent company of Google has become the fourth U.S. company to top the market value of more than $1 trillion. Shares of the Internet search giant are up nearly 17% over the last three months, outpacing a broader rally in the S&P 500 index over the same period by 6 percentage points.
Alphabet joins Apple, Amazon.com and Microsoft as the only U.S. companies to hit $1 trillion in market value. This also makes Alphabet the 2nd company with an India-born CEO to cross the $1 trillion value, after Satya Nadella-run Microsoft.
Chennai-born Sundar Pichai became the head of Alphabet in December 2019, having become chief executive of Google in 2015.
Saudi Aramco is the world’s most valuable company at a market cap of $1.85 trillion.
Alphabet’s shares are among a small group of stocks found in the top holdings of mutual funds and hedge funds, two types of institutions whose investing styles tend to be markedly different, a Goldman Sachs analysis showed. That could leave it exposed to volatile price swings if sentiment suddenly changes.
Despite those concerns, many investors are finding it hard to say goodbye. The 28% climb in Alphabet and the performance of other technology and tech-related stocks helped money managers post big gains in 2019, making it difficult for many to justify cutting their exposure even as they fret over the implications of its run-up.
Alphabet is scheduled to report fourth-quarter earnings on Feb. 3. In its latest report, the company missed analysts’ estimates for third-quarter profit by about $1.7 billion, though it beat revenue expectations.
Bearish investors, however, can point to Amazon.com, which saw its market value fall below $1 trillion after its streak of record profits ended in July. Shares of the company are down nearly 7% over the last six months, compared with a 10% gain in the S&P 500 overall.
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