Alphabet Inc, the parent company of Google has become the fourth U.S. company to top the market value of more than $1 trillion. Shares of the Internet search giant are up nearly 17% over the last three months, outpacing a broader rally in the S&P 500 index over the same period by 6 percentage points.
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Alphabet joins Apple, Amazon.com and Microsoft as the only U.S. companies to hit $1 trillion in market value. This also makes Alphabet the 2nd company with an India-born CEO to cross the $1 trillion value, after Satya Nadella-run Microsoft.
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Chennai-born Sundar Pichai became the head of Alphabet in December 2019, having become chief executive of Google in 2015.
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Saudi Aramco is the world’s most valuable company at a market cap of $1.85 trillion.
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Alphabet’s shares are among a small group of stocks found in the top holdings of mutual funds and hedge funds, two types of institutions whose investing styles tend to be markedly different, a Goldman Sachs analysis showed. That could leave it exposed to volatile price swings if sentiment suddenly changes.
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Despite those concerns, many investors are finding it hard to say goodbye. The 28% climb in Alphabet and the performance of other technology and tech-related stocks helped money managers post big gains in 2019, making it difficult for many to justify cutting their exposure even as they fret over the implications of its run-up.
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Alphabet is scheduled to report fourth-quarter earnings on Feb. 3. In its latest report, the company missed analysts’ estimates for third-quarter profit by about $1.7 billion, though it beat revenue expectations.
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Bearish investors, however, can point to Amazon.com, which saw its market value fall below $1 trillion after its streak of record profits ended in July. Shares of the company are down nearly 7% over the last six months, compared with a 10% gain in the S&P 500 overall.
