As exertion stocks person led the marketplace for the amended portion of a twelve years, determination are present 15 companies successful the assemblage that person risen to mega-cap presumption — those valued astatine $200 cardinal oregon more.
Five are valued astatine much than $1 trillion, including electric-vehicle shaper Tesla TSLA, -3.06%, which I see a tech company.
Bets person been placed connected which companies volition emergence to a trillion next, with Meta Platforms FB, +0.21% — aka Facebook — astatine the apical of astir lists and Nvidia NVDA, +4.17% sitting connected apical of mine arsenic a telephone I made 14 months ago.
Perhaps harder than rising from northbound of fractional a trillion to a trillion is rising from little than $200 billion to interruption the threshold into mega-cap status.
However, a fewer companies look destined for this result precisely, and I judge 3 person an incredibly compelling lawsuit to get determination wrong the adjacent 12 to 18 months — if not sooner.
Read: These spot companies volition payment astir arsenic the concern property segues to semiconductors
1. ServiceNow: ServiceNow NOW, +0.06% has been connected an unthinkable tally for much than a decade. From 2010 to 2020, revenues grew astatine a 59.2% mean yearly rate, portion its banal roseate astatine 44% a year. The institution finished the 2020 calendar twelvemonth astatine astir $4.5 cardinal successful revenue, and its trailing 12 months person surged adjacent to $5.5 billion.
The institution present has much than 1,266 customers with a cardinal oregon much dollars successful recurring revenue, and is seeing this fig turn astatine a important rate, including 25% successful its astir caller quarter.
Beyond the numbers, the company’s technology, which enables companies to automate and instrumentality integer workflows, continues to beryllium robust and champion of breed. The astir caller merchandise of its Rome platform, 3 further acquisitions to grow its portfolio and a deepened concern with Microsoft MSFT, +0.10% are conscionable a fewer caller highlights that supply the institution a pathway to maturation that should accelerate based connected trends including app modernization, hybrid work, workflow automation, and adjacent endeavor ESG initiatives.
It’s hard to spot ServiceNow not providing the robust maturation that volition instrumentality its marketplace headdress supra $200 billion. The company’s marketplace worth is astir $138 cardinal arsenic of Monday.
2. Qualcomm: Qualcomm’s QCOM beardown net study released past week — net per stock jumped 76% twelvemonth implicit twelvemonth and gross roseate 43% — helped thrust the banal to implicit $160 from the debased $120s successful mid-October.
Consequently, that took the company’s marketplace headdress from astir $145 cardinal to implicit $180 cardinal successful conscionable a substance of days. It serves arsenic a timely reminder of however rapidly a tech institution successful the close markets tin nutrient momentum.
Qualcomm, portion champion known arsenic a spot supplier for mobile handsets, is rapidly becoming a overmuch bigger unit successful galore categories, including the net of things (IoT), automotive and wireless RFFE. With IoT and wireless RFFE surpassing a cardinal dollars a 4th successful revenue, and automotive reaching astir a cardinal successful yearly gross with a $10 cardinal plan pipeline, the institution is becoming progressively diversified. Thirty-eight percent of gross successful its QCT semiconductor concern is present unrelated to handsets.
Perhaps these adjacent concern successes unsocial could catapult the company’s marketplace worth to implicit $200 billion, but what Qualcomm besides has going for it is an undisputable planetary marketplace enactment successful 5G, which volition proceed to accelerate its handset business, arsenic good arsenic each of its adjacencies and monolithic licensing business.
3. AMD: I’ve been captious astatine times of Advanced Micro Devices AMD, +11.44%, and sometimes you person to thin into calls you get wrong. While Intel INTC, +1.10% nether caller CEO Pat Gelsinger shows much ambition and wide direction, AMD nether Lisa Su has been connected an implicit tear.
In August, Mercury Research reported that AMD’s 22.5% x86 marketplace stock was its champion successful 14 years. With 4.2% year-over-year marketplace stock maturation successful its 2nd 4th and different 54% wide gross maturation successful the 3rd quarter, the company’s marketplace stock gains look apt to continue.
While I bash deliberation Intel is rapidly patching its gaps and going to beryllium a overmuch much robust competitor, I judge the wide request for CPUs (central processing units), GPUs (graphics processing units) and FPGAs (field-programmable gross arrays) volition thrust a larger full addressable market, and AMD’s going to turn revenues adjacent if marketplace stock gains level off.
Speaking of FPGA’s, the impending Xilinx deal, which I judge volition summation regulatory approval, hasn’t been accounted for by galore investors.
AMD’s marketplace worth roseate to implicit $180 cardinal Monday aft the banal surged much than 10%. The institution connected Monday announced a scope of news, including the information that Meta volition usage its Epyc processors successful its information halfway computers.
After those three, I would adhd Micron Technology MU, +2.59% arsenic an honorable mention. The institution sits astatine person to $85 cardinal successful marketplace cap. Still, arsenic our thirst for compute continues to grow, the request for representation exertion volition standard dramatically, making Micron a important beneficiary on with the likes of Samsung, which already sits good wrong mega-cap territory.
Daniel Newman is the main expert at Futurum Research, which provides oregon has provided research, analysis, advising, and/or consulting to Microsoft, Zoom, Salesforce, AWS and dozens of different companies successful the tech and integer industries. Neither helium nor his steadfast holds immoderate equity positions with immoderate companies cited. Follow him connected Twitter @danielnewmanUV.
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