In what may be termed a milestone of sorts, Facebook is now a bigger company than Walmart — if only on the stock exchanges.
The Associated Press reported Tuesday (June 23) that the online social giant has edged the retailer out of the Top 10 list of Standard & Poor’s 500 index, at least as of the beginning of the week. And the gap between the two companies widened from Tuesday’s trading action, according to AP, which also noted that there was no company specific news driving the displacement.
At the end of the trading day on Tuesday, Facebook’s market cap stood at $238 billion, while Walmart was valued at $234 billion. The recent price action has brought Facebook stock up 34 percent through the past 12 months, handily outpacing the broader index’s 8 percent gain through the same time period.
But toppling Walmart might give the nod to what the newswire reports as “investors’ insatiable appetite for successful tech stocks.” Alongside Facebook are other widely recognized (and widely owned) equity names including Google, Apple and Microsoft, at least in the U.S. At the top of the heap is Apple, which boasts a market cap of roughly $735 billion, chiefly on the sales of its consumer devices including the iPad and the iPhone.
AP reported that the disparity between Facebook’s results and Walmart’s financial performance shows how Wall Street favors growth for the time being. In the first quarter of 2015, Facebook’s $3.5 billion in sales was only slightly higher than Walmart’s bottom line. Yet Facebook’s top line soared 42 percent year over year on its continued strength in social media and its ubiquitous platform (and brand name) outshining a slight decline in Walmart’s revenues over the same period.
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