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Tech Giants Set to Double Their Market Valuations

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Is 2020 a turning point for tech giants? Alphabet, one of Google’s companies, just announced that it reached a trillion dollar valuation. This is the fourth tech company in the world right after Amazon, Apple and Microsoft. 

Founded about 20 years ago, Google drew interest on 17 January – when many analysts said that the company would likely double its valuation in the near future.

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Google’s shares have soared, from $50 per share in 2004 to $1,445 this week. Same thing has happened to Apple, from $118 in 2017 to $318 this year.

Although the big four’s shares are the most expensive on the market, experts agree that they remain an excellent investment. Here’s why.

Tech giants are a serious investment

After the 1999 tech bubble and the 2008 rise of tech giants, it seems that Silicon Valley is living its heydays.

The four big tech giants – Apple, Google, Microsoft and Amazon have shown tremendous growth in that period, going from a $650 million valuation all combined back in 2010 to $4.6 trillion this year.

“It’s such a phenomenally large number that it’s difficult for most of us even to quantify the value,” said Paul Lee, the global head of technology research at Deloitte to the Guardian.  

As a matter of fact, analysts explain that companies could potentially double their valuation – especially Google – as they have developed unique technologies. From AI algorithms, to new ways of purchasing – Amazon, has invented a new self-scanning method with cashless stores, or even new ways of helping the healthcare industry.

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There is room to grow

According to many experts, the exponential growth is a certainty, despite Google, Facebook and Amazon facing trials for users’ data breach.  

“At the moment, investors are being very forgiving in the view that new product or services releases will fire earnings growth; customers are being more tolerant of data use than regulators; and those investments will pay off in the long term by opening new markets or boosting returns from the existing one.”, said Russ Mould, investment director at stockbroker AJ Bell in an interview published in The Guardian.

Read on Alvexo: “Is Green Finance the Best Investment for 2020?”

How to invest in Silicon’s finest?

Although shares in tech represent a serious investment, analysts are encouraging investors to keep on purchasing them. 

Prices vary and are affordable for all budgets. At the moment, Microsoft shares are traded at $180. Apple’s stock costs $318, while Amazon’s costs almost ten times more at $2,049. Google reached $1,479 last week but has now dropped at $1,445.

Analysts have confirmed that Netflix ($369) and Facebook ($209) are the ones to watch for this season, as both might turn into trillion valuated companies in the next quarter.

Note: The opinions expressed in this article are the author's own and do not necessarily reflect the view of Alvexo on the matter.