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Prediction: These Will Be the 10 Largest Stocks by 2035

The Motley Fool
The Motley Fool
 2022-01-26

If you ask the average person to name the world's biggest public company, most would probably correctly guess the $2.7 trillion behemoth Apple (NASDAQ: AAPL) . And odds are good that a sizable segment of this crowd would be able to name a few other members of the trillion-dollar capitalization club: Microsoft (NASDAQ: MSFT) , Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) , and Amazon (NASDAQ: AMZN) . Tesla (NASDAQ: TSLA) drives in and out of the group, depending on the day.

What's interesting, however, is that the list of the world's largest publicly traded companies looked notably different just 10 years back. While Apple and Microsoft were giants back in 2012, the list of top stocks as measured by market cap also included ExxonMobil , Walmart (NYSE: WMT) , General Motors , Chevron , and even, at various points during that year, General Electric .

The point being, things change.

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Image source: Getty Images.

With that as the backdrop, in light of evolving cultural, consumer, and corporate preferences as well as current growth rates (and a judgment call on the sustainability of that growth), here's a rundown of the companies I think are likely to sport the world's biggest market caps come 2035. Note that most of these companies are already among the top-20 publicly traded companies worldwide, if not in the top 10; there's not going to be any outrageous or shocking capitalization or appreciation between now and then. The biggest surprises are apt to be the names that move further down the list as other companies are better able to flex their expansion muscles.

10. Alibaba

E-commerce giant Alibaba (NYSE: BABA) is positioned to crack the world's top 10 despite the recent regulatory crackdown by China's government on its domestic tech leaders. The world's most populous nation is still growing what will eventually be one of the world's most potent consumer classes. The World Bank estimates that more than two-thirds of China's residents will be part of the middle class by 2030, spending $10 trillion a year on goods and services. That's Alibaba's sweet spot.

9. JPMorgan Chase

Although it doesn't have as far to climb as Alibaba in order to get there, look for JPMorgan Chase (NYSE: JPM) to crack the global top 10 by 2035. The fact is, while the world is changing quickly, the need for financial services isn't going anywhere. JPMorgan Chase is a preferred provider, as evidenced by the fact that its operating income essentially doubled over the past 10 years. In fact, JPMorgan Chase is currently the nation's single biggest bank, as measured by assets. It's much easier to remain the top name in an industry than it is to displace the leader.

8. Apple

Apple is still likely to be a top 10 publicly traded company in 2035, but it's also apt to fall seven places between now and then.

This is undoubtedly a controversial call. Investors clearly love Apple, and consumers clearly love their iPhones. The tech giant has had no problem selling as many of them as it could make.

However, the smartphone market is nearing a point of deep saturation, and its rivals' devices are increasingly competitive. Technology market research outfit IDC believes unit sales of smartphones will grow at less than 3% per year between 2023 and 2025. As good as Apple is, that's a tough industrywide headwind to overcome.

Apple investors just aren't accustomed to this degree of challenge, and while the company's doing well by selling apps and other digital content, there's not enough growth on that front either to keep investors as enthusiastic as they are now.

7. Walmart

Retailer Walmart has been out of the top 10 since 2014, but don't be surprised to see it break back in by 2035.

Plenty of investors might find this prediction hard to swallow as well. While it is big, brick-and-mortar retailing is a contracting business model, and Walmart is struggling to handle its own sheer size.

However, one should not ignore the evolution underway at Walmart. It's morphing into a lifestyle company that melds in-store shopping with the types of technology consumers now prefer to use. For example, the Walmart app is also an in-store price scanning tool. The Walmart+ subscription service now boasts 32 million members, according to estimates from Deutsche Bank ; other estimates have that number even higher. Meanwhile, the company has committed to $14 billion worth of investment in automation and fulfillment infrastructure that will ultimately support its growing e-commerce business.

In other words, this is not the boring Walmart of yesteryear.

6. Taiwan Semiconductor

Taiwan Semiconductor Manufacturing (NYSE: TSM) may not be a household name, but the odds are high that you or someone in your household regularly uses its tech. The company makes semiconductors (obviously), but it manufactures them on behalf of the more recognizable names in the business.

The current global microchip shortage is a headache, to be sure, but it's also only a reflection of the world's lack of chip production capacity relative to strengthening demand. IDC forecasts the worldwide semiconductor market will grow at an annualized clip of more than 5% through 2025, when it will be worth more than $600 billion. Taiwan Semiconductor is positioned to capture more than its fair share of that growth, though, as other prolific names in the business remain hesitant to invest in production capacity that may not be needed all the time.

5. Nvidia

Nvidia (NASDAQ: NVDA) is already a top 10 stock, but look for it to move up the size ranks as a young sliver of the technology industry starts to mature.

That sliver? Artificial intelligence. While most consumers know Nvidia as one of the top makers of graphics processing units (GPUs) for video gaming hardware, that same type of hardware is particularly well suited to provide the computing needs of artificial intelligence applications. That's why around 80% of the world's supercomputers are built around Nvidia's tech, including the National Energy Research Scientific Computing Center's Perlmutter supercomputer, which now rates as the world's fastest AI supercomputer.

That dominance in this niche matters, as Mordor Intelligence believes the artificial intelligence market will grow at an annualized pace of more than 26% through 2026.

4. Alphabet

Alphabet is positioned to remain one of the world's biggest names, but by 2035, it could slide one spot lower, from third place to fourth.

Alphabet is, of course, the parent company to search engine giant Google. And it is giant. GlobalStats says Google fields more than 90% of the world's web queries -- a market share it's held for years. The world's most popular mobile operating system, Android, is also an Alphabet/Google product, powering 70% of mobile devices. As long as people choose to remain connected to the internet -- which they will -- this middleman will be able to monetize them. I only see it dropping a spot on this list because two of the three companies likely to be bigger by 2035 are going to grow faster in the meantime.

3. Tesla

Yes, electric vehicle outfit Tesla is one of those names that's apt to see its valuation explode from its already-impressive figure of right around $1 trillion.

This is another prediction not everyone will agree with. Tesla's a game-changing company, to be sure, but it has also been bid up to rich valuation levels. Competitors are also now stepping up their electric vehicle efforts.

As it turns out, though, there will be plenty of electric vehicle sales to go around. The U.S. Energy Information Administration estimates that the number of electric vehicles on the world's roads will swell from around 10 million now to more than 670 million by 2050. Tesla's powerful brand name should help maintain its place as the biggest name in that business.

2. Microsoft

Microsoft is the world's second-biggest company right now, so expecting it to simply hold that position for the next several years isn't exactly a stretch. But there's an interesting subtext here.

I don't expect Microsoft to hold its place based on sales of productivity software, nor even due to revenue from its Windows operating system. Rather, the company's top growth drivers for the foreseeable future will be its cloud computing solutions, corporate tech services, and the more specialized services it offers to small and medium-sized businesses. For instance, Microsoft controls 37% of the desktop search market and has nicely melded its LinkedIn unit with its office productivity solutions.

All the ensuing nickels and dimes add up.

1. Amazon

Finally, look for Amazon to move three notches higher and become the planet's biggest public company by 2035. Don't expect e-commerce to be its chief growth driver, though. Rather, it's everything else that Amazon does that will be pushing the company and its valuation upward.

Foremost on that list is Amazon Web Services . While the revenue that unit generates is modest compared to the company's e-commerce sales, AWS produces far more operating income than the e-commerce platform does.

There's plenty more growth ahead on that front, too. Technavio estimates the global cloud computing market will grow at an annualized rate of 17% through 2025, adding $287 billion to the industry's total annual revenue during that stretch. And even in 2025, the world's need for cloud computing services will still be years away from peaking.

In the meantime, Amazon's nascent advertising business was on pace to produce more than $24 billion in revenue for 2021, according to eMarketer, up 55% from 2020's tally. Even then, that operation will have only scratched the surface of its potential. Investment research analysts with Cowen believe the company's ad revenue will swell to more than $85 billion by 2026, supplying another tailwind for Amazon shares.

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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. James Brumley owns Alphabet (A shares). The Motley Fool owns and recommends Alphabet (A shares), Amazon, Apple, Microsoft, Nvidia, Taiwan Semiconductor Manufacturing, and Tesla. The Motley Fool recommends Alphabet (C shares) and recommends the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool has a disclosure policy .

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