With JPMorgan at the top of the list, the United States has widened its lead as home to the world’s largest companies according to Forbes’ annual Global 2000 rankings. The strength of the American markets deserves to be thanked.
By Hank TuckerForbes team
WAs Americans continue to face high prices at the grocery store and the highest mortgage rates in more than two decades, the world’s largest economy is proving as resilient as ever.
Whether the United States is simply the “cleanest dirty shirt” in a difficult time for the entire world or a leader at the forefront of an AI-powered revolution, investors remain increasingly focused on this country. There are 621 companies based in the United States Forbes’ The 22nd annual Global 2000 list ranks the world’s largest publicly traded companies, up from 611 last year, its highest level since 2007, before the financial crisis. At the same time, the number of companies calling China or Hong Kong home fell to 324 from 346 last year.
THE ASCENSION OF NVIDIA
Nvidia didn’t reach the Global 2000 top 1,000 until 2017, but now sits on the brink of the top 100.
The Global 2000 ranks companies based on their sales, profits, assets and market value, with all four variables weighted equally. This year’s list represents the last 12 months of data available through May 17. The 2,000 companies on the list collectively represent $88 trillion in market value, a 19% increase in market value, and saw slight gains to reach a record revenue of $51.7 trillion . , $4.5 trillion in profits and $238 trillion in assets.
More than $4 trillion of those assets belong to JPMorgan Chase, which holds the top spot on the list for the second year in a row. The largest US bank posted a record net profit of $50 billion and achieved a market capitalization of $500 billion for the first time, strengthening itself during last year’s regional banking crisis by attracting more deposits of customers and by purchasing First Republic Bank to emerge from its insolvency.
“Despite an unstable backdrop, including last year’s regional banking crisis, the U.S. economy remains resilient as consumers continue to spend, and markets currently expect a soft landing,” wrote CEO Jamie Dimon in his annual letter to shareholders. “By purchasing First Republic Bank, we brought much-needed stability to the U.S. banking system while allowing us to provide a secure new home for more than half a million First Republic customers. »
Warren Buffett’s Berkshire Hathaway returned to second on the list after falling to 338th last year due to unrealized losses in its investment portfolio, causing a negative net result on paper, and the Market rebound also helped Amazon climb back into the top 10 at number 1. 6. Six of the 10 largest companies and 14 of the 25 largest are based in the United States
While the S&P 500 Index hit record highs last year, the Shanghai Composite Index, which tracks Chinese stocks, and Hong Kong’s Hang Seng Index both fell for the second year in a row in 2023. China is still grappling with a property crisis precipitated by the collapse. of the Evergrande group in 2021.
GLOBAL IMBALANCE
The United States is keeping China at bay, but other emerging markets, such as India, are gaining strength.
China’s southern neighbor fared better, as India placed 71 companies on the Global 2000, up from 55 last year, overtaking the UK and South Korea to make the top five most represented countries. Its largest company, Reliance Industries, the conglomerate of billionaire Mukesh Ambani, ranks 49th with $109 billion in 12-month revenue and a market capitalization of $233 billion. Life Insurance Corp. of India, which just went public in 2022 and debuted on the list last year at No. 362, climbed to No. 70 this year, with profit rising nine-fold to Rs 4.9 billion. dollars and a stock up 70%.
Other notable advances in the ranks include telecommunications giant AT&T. The company, which operated as a monopoly for much of the 20th century and whose origins date back nearly 150 years, fell to 370th last year due to a net loss of $23.5 billion. dollars it recorded following asset write-offs in the fourth quarter of 2022, but rebounded to 37th place thanks to a return to profitability, despite a stagnant stock price.
In the other direction, Pfizer, which is even older than AT&T, founded in 1849, is the most prominent name among a host of drug companies that have plunged in the rankings. After being one of the heroes of the pandemic, vaccinating billions of people around the world, Pfizer has struggled in the post-Covid world. Its 12-month sales through the first quarter of this year fell 41% to $55 billion from a year earlier, and it was slightly loss-making over the past 12 months after dipping into the red in the third and fourth quarters 2023. Albert Bourla acknowledged that Pfizer missed its internal projections during its year-end earnings call and that its stock price was lower than it was even at the start of the pandemic. It fell to 436th from 39th in this year’s Global 2000.
MOVERS AND SHAKER
Here are the companies that made the five biggest jumps into the top 100 and the five biggest falls out of the top 100.
Pfizer’s counterpart in the anti-Covid vaccine sector, Moderna, suffered an even steeper fall. Its sales in the first quarter of this year were just $167 million, down 91% from last year’s quarter of $1.9 billion. Over a 12-month period, Moderna’s revenue of $5.1 billion is down 66% and the company posted $6 billion in net losses. Its Global 2000 ranking fell more than 1,000 places, from No. 462 to No. 1,468. Nonetheless, the promise of new products in development, including an RSV vaccine and a combined Covid flu vaccine, has allowed its stock to rebound 31% this year, although it remains 67% below its 2021 peak.
While pharmaceutical and biotechnology companies have been the hardest hit sectors, many of the best performers have been concentrated in financial services, insurance and semiconductors. Nvidia, the darling of the stock market for the past two years thanks to its dominance in making graphics processing units for AI applications, climbed more than 100 places to 110th, and others Major chipmakers like Broadcom and Advanced Micro Devices also jumped significantly.
SEMICONDUCTOR OVERVOLTAGES
Chipmaking has been one of the hottest industries of the year, as companies race to create new AI applications.
In a quiet year for major IPOs, there are relatively few new entrants to the list, but one company debuting at No. 856 thanks to the AI boom is Super Micro Computer, whose stock has grown more than 800% since the start of 2023. The San Jose-based company, which sells servers and data center storage, now has a market cap of $52 billion, with earnings of $1 billion over the last 12 months on a turnover of 12 billion dollars, a turnover almost doubled in one year. The highest-ranked newcomer at No. 680 is GE Vernova, a spinoff of General Electric’s energy operations that began operations last May.
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