The market capitalization of the 100 largest companies in the world increased by 2.597 trillion dollars, or 15% compared to the state on March 31, 2017, according to PwC’s published ranking of the 100 largest global companies, Global Top 100. This increase continues the 12% rise from 2017, and the total market capitalization has been growing year on year since the global financial crisis.
The growth of forty-eight percent in the past year is attributed to American companies, thanks to stable economic conditions and a leading position in the technology sector. Europe has recorded an increase in market capitalization for the second consecutive year, with an unchanged market share.
Market capitalization (in billions USD) and number of companies by locationNumber of companies/Source: Bloomberg and PwC
Kina sustiže SAD
For the fourth consecutive year, the USA is represented by more than half of the 100 largest global companies (54 companies, compared to 55 in 2017). The USA also holds 61% of the total market capitalization, which represents a decline from last year’s 63%.
Amazon is the most successful company in terms of absolute market capitalization growth, achieving a value of 278 billion US dollars or 66% compared to 2017. It is followed by two Chinese companies: Tencent, with an increase of 224 billion US dollars, or 82%, and Alibaba with an increase of 201 billion US dollars, or 75%. The next three most successful companies in absolute terms are American companies Microsoft, Alphabet, and Apple.
Despite being ranked sixth in terms of absolute value growth, Apple still has the best starting position in terms of market capitalization for the seventh consecutive year. However, its advantage over Alphabet, which holds second place, has decreased by 25%, recording a drop from last year’s 175 billion dollars to this year’s 132 billion dollars. Apple also paid out more to shareholders than all other companies, distributing an additional 31 billion dollars to investors in the form of dividends and share buybacks in the calendar year 2017 (while in the calendar year 2016 it paid out 29 billion dollars). JP Morgan Chase ranks second in value distribution with 24 billion dollars, recording an increase of 18 billion dollars compared to the previous year.
When it comes to sectors, technology has led the financial sector in market capitalization for the third consecutive year, while consumer goods occupy third place. The three largest companies in the world still come from the technology sector – Apple, Alphabet, Microsoft – followed by Tencent in fifth place and Facebook in eighth, which has dropped from last year’s sixth place.
Europska poduzeća
European companies were particularly hard hit by the global financial crisis a decade ago, since when their market capitalization has experienced fluctuations. However, during the past year, Europe continued its gradual recovery, with the number of European companies among the largest 100 increasing by one, from 22 to 23 companies, with a total increase of 331 billion dollars in total market capitalization.
Despite this improvement, Europe has still not reached the level of 2010 when 33 European companies were included in the ranking of the 100 largest. Its market share of 17% in 2018, although unchanged from 2017, has fallen from 27% which it was in 2009.
The market capitalization of companies from China included in the top 100 jumped by 57% compared to 2017, with 12 Chinese companies entering the top 100, while there were 10 last year. Hong Kong also increased the number of its companies from one in 2017 to this year’s three companies. In terms of absolute market capitalization growth, Tencent is the leading Chinese company in 2018 for the second consecutive year, and the second most successful after Amazon, increasing its value by 82% to 496 billion dollars. Alibaba is the second most successful Chinese company and third overall, increasing its value by 75% to 470 billion dollars. These significant increases have pushed both companies into the top 10 in terms of market capitalization, with Tencent taking fifth place and Alibaba seventh.
– Among this year’s figures, the significant increases in the value of leading Chinese companies stand out the most. American companies have used their global reach, financial strength, and ability to innovate for years to rise above the rest of the world. China is now relying on equal footholds, which primarily rest on the vast Chinese market, to catch up with American leadership. The entry of Tencent and Alibaba into the top 10 is a clear indicator of their success in these efforts, commented Ross Hunter, partner and head of the IPO services center at PwC.
