2020 has been the worst year for the world since the end of the WWII. Unless you've been living under a rock, you know that the coronavirus pandemic struck China, in Wuhan, who initially held details about the same, refusing to cooperate and release the appropriate information which would have allowed other countries to battle it. As it was, the virus was transmitted from China to several other countries, and rather than an epidemic in a specific area, became a global pandemic within a couple of months.
As little was known about the origins of the virus as well as how to battle it, countries were completely unprepared even as things went south really fast. The virus spread at an incredible speed, and infected millions of people, with a fatality rate much higher than the flu, to which it was compared initially on. Since countries did not know how to battle the virus or how to cure those who were infected, lockdowns were swiftly implemented. Often called draconian initially before being realized as necessary, these lockdowns brought the world to a standstill, as billions of people were unable to leave their homes and economies came to a screeching halt. Most industries across the world were shut down, with only necessary businesses being able to operate. While those who could work from home managed to persevere, for example in the tech industry, other industries such as the construction industry were completely rattled.
Most Valuable Companies In The World in 2021
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However, perhaps few industries had to bear the impact of the virus like the hospitality and airline industry. Even before lockdowns were implemented, countries started banning international travel from China and other countries where the virus spread quickly. Because of this, international flights came to a standstill as well. I remember returning through Dubai International Airport in March 2020 and finding it completely abandoned. As someone who had always seen the airport full of passengers bustling about, it was kind of eerie noting how most of the lounges were empty and even the duty free, paradise for most shoppers, was completely empty too. And since travel was banned, the hospitality industry, including hotels, suffered a lot as well. Hotels were unable to find occupants and had to slash rates and still lose out on tons of money. In fact, airlines are expected to have lost around $84.3 billion, according to the the International Air Transport Association.
This brings us to 2021. While many people couldn't wait to see the end of 2020, 2021 hasn't started out so well, has it? The United States and the United Kingdom, along with many other countries starting reporting a record number of cases and deaths as the second wave caused even more devastation than the first, resulting in many countries, including the UK, France and Germany reintroducing complete or partial lockdowns, which again devastated economies. In fact, most of the countries across the world have suffered from either a recession or a depression in the past year, and apart from China, few countries are aiming for their economy to be back on track anytime soon.
However, there's always light at the end of the tunnel, and the development of vaccines which have proven efficient against the Covid-19 pandemic has renewed belief that we might at the end of this year, finally say goodbye to one of the worst incidents in history. And the development and implementation of the vaccine in less than a year by multiple companies, when the process generally take 5 years if at all, shows how far we have come in technology and advancement. To the companies which have developed the vaccines, this will result in additional revenues of several billion dollars.
Of course, even the effects of a pandemic aren't equal across any of the metrics. For example, in the United States, while the coronavirus took off a year in life expectancy of the white population, it actually took off three years from the life expectancy of the black population. Blacks were also a lot more likely to be infected and suffer from the virus as compared to the white population, primarily due to the fact that black people in the US don't have access to the same level of healthcare that white people do.
While most companies and industries suffered, not everyone did. The biggest companies in the world in February 2021 were able to navigate through the pandemic relatively unhindered. These companies had enough reserves and resources to battle the effects of the pandemic, while many, especially those in the tech and online retailing industry, actually saw their numbers grow vastly. The tech industry actually saw many companies grow significantly and while tens of millions of people lost their jobs, billionaires saw their total net worth increase by $637 billion, with Elon Musk alone gaining more than $120 billion within a single year, the biggest annual increase ever seen in the net worth of a person (see 25 Highest Earning Billionaires in 2020). This happened even as Tesla continued defying expectations and having its value grow astronomically to the point that is now among the most valuable companies in the world, while just a couple of years ago, it was nowhere close to achieving this.
Of the 15 most valuable companies in February 2021, 9 are from the United States of America. This is because of the fact that the United States has more lax rules and regulations as compared to Europe, and encourages capitalism, which allows companies to become bigger than most countries. The 20 biggest companies in the world right now have a market cap exceeding $16 trillion. Two of these companies are currently worth more than $2 trillion, while 5 companies are worth more than $1 trillion. All the data in this article, where the companies are ranked by market cap, has been taken from Yahoo Finance, with foreign currencies being converted to USD based on the current exchange rate. So without further ado, let's take a look at the 20 most valuable companies in the world, starting with number 20:
Total market cap of the company as at February 22, 2021 (in billions of dollars): $338
The financial services company processes payments between banks and customers, and currently has around 19,000 employees. Here is what Del Principe O’Brien Financial Advisors recently said about MA:
“The market pullback in the spring gave us a chance to become owners of Mastercard, one of the biggest players in the global payments industry. In fiscal year 2019, the company processed almost $5 trillion in purchase transactions and holds 29% of the global market share for credit cards and 24% of the global market for debit cards.
Total market cap of the company as at February 22, 2021 (in billions of dollars): $351.88
Disney is one of the biggest entertainment companies in the world, and with its recent launch of Disney+, a streaming service, it aims to continue its dominance for many years to come. Disney reported an adjusted profit of 32 cents per share for the three months ended January 2, contrary to a loss of 34 cents per share forecasted by analysts. Revenue for the quarter came in at $16.25 billion, down from $20.88 billion in the year-ago quarter. Analysts on average were looking for revenue of $15.93 billion.
Revenue from the Disney Parks, Experiences and Products segment declined 53 percent on a year-over-year basis to $3.6 billion, as Disney theme parks stayed closed during the quarter. Comparatively, revenue from the Media and Entertainment Distribution slipped 5 percent to $12.66 billion.
On the bright side, Disney+ subscriptions reached 94.9 million in the quarter, well above the consensus forecast of 90.7 million.
Speaking on the results, CEO Bob Chapek said, “we believe the strategic actions we’re taking to transform our Company will fuel our growth and enhance shareholder value, as demonstrated by the incredible strides we’ve made in our DTC business, reaching more than 146 million total paid subscriptions across our streaming services at the end of the quarter.”
Total market cap of the company as at February 22, 2021 (in billions of dollars): $365.495
NVDA ranks 18th in our list of the most valuable companies in the world. NVDA is primarily involved in the production of graphics processing units for gamers as well as professionals, and has also dabbled in artificial intelligence. Here is what Vulcan Value Partners has to say about NVIDIA Corporation in their 2020 Q3 investor letter:
“NVIDIA Corp. is the dominant supplier of Graphics Processing Units (GPUs) worldwide. During the first quarter of 2019, its stock price declined considerably due to the combination of three factors. A capital spending hiatus by cloud providers, the collapse in demand for cryptocurrency mining, along with the end of the product cycle in its most recent gaming chip caused NVIDIA to miss its quarterly earnings estimates. As a result, we were given the opportunity to purchase NVIDIA with a significant margin of safety in March of 2019. NVIDIA’s value grew substantially while we owned it, and we continued to follow our discipline by trimming and adding to the company as its price fluctuated. We exited NVIDIA when its stock price rose close to our estimate of fair value. The combination of its value growth and the closing of the price to value gap provided substantial returns over our investment period.”
Total market cap of the company as at February 22, 2021 (in billions of dollars): $388.422
Walmart is the biggest retailer in the world, and in terms of revenue, is comfortably the biggest company in the world, with revenue greater than half a trillion dollars in 2019. The company on Thursday announced mixed results for the fourth quarter along with a weak outlook. Walmart reported a loss of $2.09 billion, or 74 cents per share for the quarter, as compared to earnings of $1.45 per share in the same period last year. On an adjusted basis, the retail giant reported a profit of $1.39 per share that missed the consensus forecast of $1.51 per share.
Revenue came in at $152.08 billion, beating analysts’ average estimate of $148.51 billion. U.S. comparable sales in the quarter rose 8.6 percent, while analysts were looking for a rise of 5.6 percent. On the bright side, online sales in the U.S. skyrocketed 69 percent, well above a 35 percent surge in the comparable quarter of the prior year. Comparatively, same-store sales at Sam’s Club rose 8.5 percent in Q4.
However, Walmart incurred $1.1 billion in pandemic-related costs during the quarter, as it had to pay bonuses to front-line workers and spend more to ensure the cleanliness of its stores. Nevertheless, the company increased its annual dividend by 2 percent to 55 cents, besides approving a stock repurchase plan worth $20 billion.
Total market cap of the company as at February 22, 2021 (in billions of dollars): $460.49
Visa ranks 13th on our list of the most valuable companies in the world. If you have a debit or credit card, its most likely either Visa or MasterCard, and is among the biggest financial services companies in terms of market cap. MoffettNathanson’s Senior Equity Analyst, Lisa Ellis, rated both Mastercard Incorporated (NYSE: MA) and Visa Inc. (NYSE: V) as stocks to watch and included in her ‘buy’ list. “What people don’t realize is that a lot of the spending if you use a service like a firm or Afterpay or PayPal, is actually going over cards, sometimes it’s a debit card instead of a credit card,” said Ellis in a short interview with CNBC.
“When you break up these transactions from one big Peloton to lots of investments for that Peloton, those underlying companies actually make more money because they make more money off of lots of smaller transactions instead of a big one.”, she said while noting that the rise of after pay companies like PayPal will be much of a benefit for Mastercard and Visa since they are the companies behind these famous payment services.
Total market cap of the company as at February 22, 2021 (in billions of dollars): $501
Samsung ranks 11th on our list of the most valuable companies in the world. Samsung is a market leader in many electronics industries, including smartphones, televisions and sound systems and has assembly plants in 74 countries.
