Being a multi-billion dollar corporation used to be a big deal. Now, it’s who is going to be the next trillion-dollar stock? And where that itself was once a rarity, today there are half a dozen trillion-dollar stocks.
To attain that valuation, these are all obviously successful, profitable businesses. They offer products and services that are in high demand. Buying a basket of these trillion-dollar behemoths wouldn’t be a bad strategy, but some of these stocks offer better opportunities than others.
The three trillion-dollar stocks below are the best opportunities for investors seeking impressive gains in the coming year and beyond.
Amazon (AMZN)
The big event for Amazon (NASDAQ:AMZN) is coming. Its Prime Day sales event is scheduled to launch on July 16. It is the biggest sales day of the year for the e-commerce giant and should help rally its stock further. AMZN is up 27% in 2024 and is 50% higher over the past year. It recently cracked the $2 trillion valuation threshold, making it the fifth most valuable company on the market.
And now Amazon is taking on PDD Holdings (NASDAQ:PDD) Temu and Schein. After seeing the explosion of sales from these dirt-cheap retailers, the e-commerce giant is taking the fight to their doorstep. It will open a discount storefront in China for brands to ship products to overseas customers. While delivery will take seven to nine days, longer than the typical two-day Prime delivery time, the products will presumably sport the bargain-bin pricing Amazon’s competitors offer.
But it is in AI cloud services where Amazon will excel. As one of only a handful of global hyperscalers, it is turning to AI shop Anthropic to grow the business even further the way Microsoft (NASDAQ:MSFT) used OpenAI’s ChatGPT to jumpstart Azure.
As Amazon’s cash cow (and profit center), Amazon Web Services can quickly regain its former growth momentum.
Meta Platforms (META)
Meta Platforms (NASDAQ:META) is the next trillion-dollar stock to buy not only because of the dominance and sway of its social media platforms but also because of its positioning within the AI universe.
With the number of daily active people across Facebook, Instagram and Messenger rising to 3.24 million, the company saw revenue jump 27% higher. Average revenue per person also rose 18% to $11.20 from $9.71 last year, and it produced excess cash profits of more than $12 billion. Where Meta can truly develop significant revenue growth is by implementing AI across its family of apps.
Meta is essentially evolving itself into a super app with some of the most powerful large language models (LLM) around. More importantly, it is developing its AI models with consumers in mind, whereas most others are aimed at enterprises. Meta calls its LLM Llama-based AI agent “the most useful assistant in the world.”
That distinction of focusing on everyday users will set Meta Platforms apart. While investors were initially concerned about the social media platform investing deeply in AI, remembering the metaverse debacle, they’ve warmed up to it since. Meta stock is up 45% year-to-date and 77% higher over the past year. It has regained all the ground lost after its AI announcement and now sits just 5% below a new all-time high.
Alphabet (GOOG, GOOGL)
It is not so dissimilar for Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL), the third trillion-dollar stock to buy. The third largest hyperscaler behind Amazon and Microsoft, Alphabet’s Google has countered the AI efforts of others with Gemini. It got off to a bumpy start, but they have been ironed out and now Gemini is embedded in many of Alphabet’s services. It is also developing an AI chip, Axion.
Google Cloud saw revenue surge 28% in the first quarter to $9.6 billion. Operating income rocketed to $900 million from $191 million a year ago. Although the smallest of the Big Three cloud providers, Google’s is the growing fastest (Microsoft saw 23% growth in the period). AI is making a difference.
The real driver for Alphabet, though, is its ad revenue is picking up again. Total revenue grew 15% to $80.5 billion, with ad revenue up 13% to $61.6 billion. Search saw a 14% increase, while YouTube ads grew 21%. The segment’s operating income was up 28% year-over-year.
Alphabet has other arms, such as its autonomous vehicle service Waymo and its X lab, a business incubator that produced Wing, Alphabet’s drone delivery service.
The company occupies a strong competitive position across its platforms, and as AI adoption accelerates, expect to see Alphabet stock target a $3 trillion status.
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.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
