Seriously, how much longer before Nvidia (NASDAQ:NVDA) overtakes Microsoft (NASDAQ:MSFT) as the most valuable company in the world? The chipmaker just surpassed Saudi Aramco to become the third-most richly valued company at $2.2 trillion. With less than a trillion dollars to go to leapfrog over Microsoft, it’s really just a matter of time.
But while Nvidia is sucking all the oxygen out of the room as it grows by leaps and bounds, there are other contenders for the trillion-dollar club. They might not reach it quite as quickly as Nvidia, but they are within striking distance. They could cross the threshold sooner rather than later. Below are three stocks ready to rise and join this elite group of stocks.
Berkshire Hathaway (BRK-A, BRK-B)
Warren Buffett’s Berkshire Hathaway (NYSE:BRK-A, NYSE:BRK-B) is the closest of the three to achieving a $1 trillion valuation. For both the Class A and Class B shares, Berkshire is currently worth north of $870 billion. As it owns dozens and dozens of businesses, the immediate value of the conglomerate is remarkable.
Yet, Berkshire Hathaway is more like a giant cruise ship than a nimble speedboat. It makes long, sweeping curves to turn rather than sharp zig-zags. That means despite it being the most valuable of the three stocks listed here, it may take the longest to reach the goal.
Berkshire has other challenges too. Buffett’s right-hand man, Charlie Munger, just died. He was 99 years old. Buffett is 93. Although he will likely captain Berkshire Hathaway until he passes away, it is obvious he isn’t going to be at the helm much longer. While Buffett nominated Greg Abel to succeed him, ensuring Berkshire has a succession plan in place, the market won’t revere Abel the way it does Buffett.
Investors hang on to the investing guru’s every word. They watch all of his stock trades. His passing will undoubtedly set back Berkshire Hathaway’s progress. It may even delay or thwart the company’s effort to achieve the milestone.
Eli Lilly (LLY)
Drug manufacturer Eli Lilly (NYSE:LLY) isn’t built on a cult of personality but rather a succession of multi-billion-dollar therapies to treat a variety of diseases. Lilly’s biggest drug is Trulicity, a treatment for type 2 diabetes. It generated $1.7 billion in fourth-quarter sales and $7.1 billion for the full year. But sales are declining (down 14% in Q4), and Lilly had trouble filling demand for the treatment.
Its next big drug is another diabetes therapy, Mounjaro. It produced $2.2 billion in sales in Q4 and is rapidly scaling up. Sales stood at $980 million in the second quarter and rose to $1.4 billion in the third. For the full-year sales hit almost $5.2 billion and could end up being the biggest drug in Eli Lilly’s portfolio.
Along with the pharma’s recently approved Zepbound, Mounjaro could be the one-two punch to take on Novo Nordisk (NYSE:NVO) in fighting diabetes and obesity. The two drugs target the same market as the Danish drugmaker’s Wegovy and Ozempic, respectively. Those two therapies saw a significant increase in sales from the year before.
The pair of treatments alone might be enough to push Eli Lilly to trillion-dollar status. It currently has a market capitalization of $740 billion. If Zepbound and Mounjaro get the same reception as their rivals, they could help the pharma stock fill the gap.
Taiwan Semiconductor Manufacturing (TSM)
Semiconductor foundry Taiwan Semiconductor Manufacturing (NYSE:TSM) just might have Nvidia to thank for helping it reach a $1 trillion valuation. As the world’s largest pure-play foundry, Nvidia is one of the chipmaker’s biggest customers for the artificial intelligence (AI) chips carrying it to new heights.
Yet, TSM, as the chipmaker is known, is also the primary destination for other chip stocks looking to cash in on the AI craze. Advanced Micro Devices (NASDAQ:AMD), for example, also uses TSM as does Intel (NASDAQ:INTC), though to a much lesser extent. Taiwan Semiconductor also counts Apple (NASDAQ:AAPL), Qualcomm (NASDAQ:QCOM) and Broadcom (NASDAQ:AVGO) as primary customers as well.
At just $732 billion, TSM has the furthest to go. Supply chain issues and capacity constraints have actually held the chipmaker back over the past few years. The semiconductor stock is building out new factories to meet demand. With the current insatiable appetite for AI chips unrelenting, Taiwan Semiconductor Manufacturing just might cross over the threshold sooner than many expect.
On the date of publication, Rich Duprey did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
