Big Tech Stocks to Watch in 2021 | 10 Investing Opportunities
Big Tech stocks have had a great run over the last few years. They’ve only gotten bigger, and the top five of them now make up close to 25% of the total S&P 500. That’s a huge slice of the pie. Although, with that dominance comes a new round of challenges.
More politicians and regulators are clamping down. Old antitrust laws don’t apply as well because many of the tech companies offer free services. But politicians are getting more creative and new ideas are on the horizon to break up Big Tech.
Whether that comes to fruition or not, these companies will continue to push sales higher. And if you buy into a company that’s broken up, you still might automatically own all the pieces.
Some of the stocks below could easily continue to be market leaders. They’ve created services that billions of people willingly use around the world.
How Big Are Big Tech Stocks?
When talking big numbers, it’s easy to gloss over them. So I want to first give some examples that show how big some of these companies have become…
Coming in first place is Apple (Nasdaq: AAPL) with more than a $2 trillion market cap. At that level, it’s worth more than Canada’s entire GDP. And if we could spread ownership of Apple evenly among every American, we could each collect more than $6,500.
Facebook is another juggernaut with hard-to-fathom numbers. In its recent quarterly filing, it reported 1.82 billion daily average users. And if those are unique users, that’s close to 25% of the world’s population… on a daily basis!
Facebook also reported 2.74 billion monthly active users. So that climbs to 35% of the world’s total population. And unless you’ve been living under a rock, you’ve benefited from Facebook’s free services and innovation.
Of course, big changes and innovation come with downsides, but ultimately no one has to use these companies’ products and services. There are hundreds and likely thousands of alternatives. Yet these Big Tech stocks have been great investments so far…
Largest Technology Stocks by Market Cap
Tech Stock | Market Cap |
1. Apple (Nasdaq: AAPL) | $2.2 trillion |
2. Microsoft (Nasdaq: MSFT) | $1.6 trillion |
3. Amazon (Nasdaq: AMZN) | $1.6 trillion |
4. Alphabet (Nasdaq: GOOGL) | $1.2 trillion |
5. Tesla (Nasdaq: TSLA) | $0.8 trillion |
6. Facebook (Nasdaq: FB) | $0.7 trillion |
7. Alibaba Group (NYSE: BABA) | $0.6 trillion |
8. Taiwan Semiconductor Mfg. (NYSE: TSM) | $0.6 trillion |
9. Nvidia (Nasdaq: NVDA) | $0.3 trillion |
10. PayPal Holdings (Nasdaq: PYPL) | $0.3 trillion |
*Numbers from January 13, 2021
For one last example to put their size in perspective… Amazon is now much larger than the next five largest retailers combined. That’s Amazon’s $1.6 trillion valuation compared with a total of $1.1 trillion for Walmart (NYSE: WMT), Home Depot (NYSE: HD), Costco (Nasdaq: COST), Lowe’s (NYSE: LOW) and Target (NYSE: TGT).
Also, it’s good to note that many existing companies are becoming technology companies. To survive and stay competitive, they have to use more technology.
Walmart, for example, is a staple consumer goods company (here’s a list of 20 consumer staple stocks). Although, it’s been investing heavily in online platforms and other technologies to keep up. Thanks to its supply chain innovation, Walmart now offers next-day delivery to 75% of the U.S. population.
We’ll see this trend continue with all companies. And going forward, that gives us even better investing opportunities…
Top Investing Opportunities
Many of these Big Tech stocks will continue to outperform. They’ve not only survived but thrived during the pandemic. On top of that, these companies have managed well through different political agendas in the past.
So, barring an economic collapse, it could pay well to add a few of these companies to your portfolio. Or even better yet, there are smaller opportunities with even higher growth potential. Imagine if you invested in Apple 20 years ago!
To uncover some of the top investing opportunities around, you can find our recent technology investing research here.
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