Digital giants overtake industry - US Internet companies are the world's most valuable enterprises

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  • For the first time ever technology and Internet companies take the top six places
  • Two Chinese Internet companies in the top 10
  • The most valuable European company is Royal Dutch Shell at number 13 - Nestlé is the most valuable Swiss company in 21st place
  • Three Swiss companies are among the top 100 (and seven in the top 300)

ZURICH, 29 JUNE 2018 – US and Chinese digital groups currently dominate the ranking of the most valuable companies and have massively increased in value since the beginning of the year: The stock market value of the world's six most expensive companies - for the first time ever all are digital companies - increased by a good 500 billion Euros or 13 per cent this year. This is the finding of an analysis undertaken by the auditing and consultancy group EY which examines the market capitalisation of the world's 100 most expensive companies every six months.

As at the beginning of the year the most expensive company in the world is Apple with a market value of USD 905 billion at the present time. Amazon takes the second place; the on-line retailer has moved up two places since the start of the year and has increased its stock market value by 43 per cent to a good USD 806 billion. This corresponds to an increase in value of just under USD 240 billion in six months - more than the entire stock market value of the most valuable Swiss Group, Nestlé. The third to fifth places are occupied by Alphabet, Microsoft and Facebook, also American digital groups, followed by Alibaba and Tencent, two Chinese Internet groups.

Investors are concentrating on companies with digital business models
But it is not only among the top 10 that the world's digital groups are now taking up dominant positions - in the top 100 ranking companies with digital business models have also increased in importance in the last six months: their number increased from 18 to 22 - while the number of banks and insurance companies dropped from 22 to 16 over the same period. The cumulative value of all 100 companies in this analysis reduced slightly by 0.3 per cent to USD 20.0 trillion since the beginning of the year. American companies account for 64 per cent of the total value, Asian companies 19 per cent and Europeans only 16 per cent.

"At the present time investors are primarily concentrating on companies with digital business models, some of which command significantly higher stock market values compared with companies in traditional sectors with comparable sales and profits", commented Stefan Rösch, Partner and Manager of Transaction Advisory Services at EY in Switzerland. "It is obvious that investors currently believe that digital companies have much greater growth opportunities. And they anticipate that digital companies will disrupt structures in other sectors and will be able to dictate the rules, just as some of the leading Internet groups have already done."

European groups losing their importance
As at the beginning of the year 22 European groups currently occupy positions in the ranking of the world's 100 most expensive companies - North American companies take 57 of these positions and Asia 21. However, the top European groups have a significantly lower total value than competitors from North America and China. All European companies have a combined stock market value of USD 3.1 trillion, three per cent less than six months ago. The Asian companies have a stock market value of USD 3.8 trillion and the North American companies total USD 12.8 trillion (up two per cent).

Nestlé, Roche and Novartis in the top 100
As Europe's most valuable company, the Anglo-Dutch oil company Royal Dutch Shell occupies the number 13 position with a market value of USD 293 billion. A total of three Swiss companies, Nestlé (233 billion, number 21), Roche (188 billion, number 34) and Novartis (186 billion, number 35) occupy positions in the top 100. Another six Swiss companies, Glencore (70 billion, number 148), Chubb (58 billion, number 187), UBS (57 billion, number 193), Richemont (48 billion, number 239), ABB (46 billion, number 255) and Zurich (44 billion, number 276), are to be found among the top 300 companies.

Stefan Rösch's thoughts on the present dominance of the American groups and the increasing dominance of Chinese groups: "It is clear that at the present time European companies all too rarely present investors with a persuasive model for the future. It is therefore all the more important that the European economy should gain a new impetus and demonstrate that it has something important to say in the digital economy of the future."

 


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