CNBC’s Jim Cramer has identified three companies that could potentially join the trillion-dollar club, in the wake of Nvidia Corp‘s NVDA rapid ascension.
What Happened: On Monday, Cramer named Eli Lilly and Co LLY, Berkshire Hathaway Inc BRK BRK, and Tesla Inc TSLA as potential candidates for the trillion-dollar market cap, reported CNBC.
"There is no next Nvidia — it's what we call at law school sui generis — and you might not see another story this strong for a generation," he said, while also mentioning that there are other companies "that can break through the $1 trillion barrier and while they're not as exciting as Nvidia, a few of them come pretty darned close."
He highlighted Eli Lilly as a strong contender, with a current market cap of over $730 billion according to FactSet. Cramer believes the company’s value could skyrocket due to the potential of its GLP-1 drugs, which are currently used to treat diabetes and obesity. There is also ongoing research on their effectiveness in treating cardiovascular and liver diseases.
Berkshire Hathaway, valued at over $905 billion, and Tesla, with a market cap of over $611 billion according to FactSet, were also mentioned as potential candidates. Cramer suggested that the rising cost of auto insurance could drive Berkshire Hathaway’s value even higher. He also noted that Tesla’s value could increase with the release of new models, but he sees it as less likely to reach the trillion-dollar mark.
According to FactSet, the current valuation of Broadcom Inc is $606 billion. Cramer believes that the company has potential because of its creative CEO, Hock Tan, who has acquired experience. Cramer fears that this partner of Nvidia will never be able to accomplish more. If so, it could be necessary for Nvidia to pass the $5 trillion threshold before Broadcom does. $1 trillion mark.
Why It Matters: The trillion-dollar market cap is a significant milestone for any company, signifying its immense size and influence in the global market. Nvidia recently achieved this feat, becoming the fourth company in the world to do so, after Microsoft, Apple, and Saudi Aramco.
Earlier in February, Warren Buffet’s Berkshire Hathaway was closing in on the trillion-dollar mark as its Class A shares surpassed $600,000 for the first time. This further underscores the significance of the trillion-dollar market cap and the companies that are on the brink of achieving it.
Despite the current market uncertainties, as highlighted by Cramer, these companies’ potential for reaching the trillion-dollar mark reflects their resilience and strength in the face of economic challenges.
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