The year 2021 has become a heyday for the US economy. Despite the supply problems and obstacles that arose during the pandemic, the Dow Jones, S&P 500 and NASDAQ indices showed new historical highs. An important incentive for growth was the positive attitude of investors to the prospects of the global economy.
No matter what success any company had in 2021, 2022 will be significantly different from it. Moreover, experts say that a positive attitude can be sharply replaced by a negative one. In 2022, the pandemic problem will remain quite burning, plus the Fed's plans to tighten monetary policy will not have a very positive impact on economic development. These two factors can spoil the reporting of many companies both during the first quarters and for the whole year.
Those who doubt the choice of promising investments should consider two companies that, under almost no circumstances, will not remain at a loss. Today we will talk about the Dow Jones, S&P 500 and NASDAQ.
Alphabet
For a complete picture of what the company can expect in the near future, it is necessary to consider the financial indicators for the last two years. The company's total revenue for 2020 exceeded the previous one by 13%. This is despite the fact that pandemic problems have somewhat reduced the demand for advertising services. The sprawling segment of Google Cloud allowed the company to show quite impressive results.
The period of recovery of the company's financial indicators fell in the middle of 2020. At this time, the margin increased from 21% shown in 2019 to 23%. Diluted earnings per asset amounted to 19%.
The company showed similar efficiency in 2021, when revenue has already increased by 45% in annual terms. This fact was mainly provided by Google advertising and cloud services, which grew almost synchronously. In the first three quarters of 2021, the company's option margin increased by 36%, and the profit per asset increased by 124%.
Analysts believe that by the end of the 2021 reporting year, the company's revenue and revenue will grow by 39% and 85%, respectively. Similar figures for the end of 2022 will be about 17% and 4%.
Given these data, the company is particularly resistant to the vicissitudes that occur in the world. It follows that with the formation and active development of the world economy, the company's performance will only get better.
What reasons contribute to such an active growth? In accordance with the above data, we can say that these are two main areas of activity - advertising and cloud services.
The advertising business is in the first position in Alphabet. Due to this sector, the company receives most of the funds. This helps the company to develop actively in any economic conditions. In addition, the company is under pressure from the regulator, attributing monopolism to it, and for this regularly issuing quite high fines. Also, many groundlessly accuse the company of privacy problems, which is one of the reasons for the investigations against Alphabet.
Regardless of all the listed problems, nothing super-scary will happen to the company, since no businessman will cut a branch under him, which also bears fruit generously.
The second profitable area of activity is cloud services. According to official data, for the 3rd quarter of 2021, the company owned 8% of the market in this field of activity. Today, the company ranks third after Amazon and Microsoft. Despite its slightly non-leading positions, PayPal, Twitter and Home Depot are happy to use its services, which significantly increases the rating of the enterprise and attracts more and more new customers. The company's losses are easily compensated by a profitable advertising business.
The profitability of the enterprise's cloud services increased by 45% over the year, and for the 3rd quarter of 2021, Amazon rose by another 39%, and Microsoft by 50% over the last quarter.
Analysts are confident that the company will continue to develop on its own services, since the world economy, overcoming the consequences of the pandemic, is currently at the stage of active formation.
Amazon
Throughout 2020, the company has shown outstanding financial results. A couple of years before that, the company's assets jumped in price by 70% at once, whereas in 2021 they showed more modest results – only about 5%. This is significantly less than, for example, a 27% increase in the SP500 index over the same period. But analysts are fully confident that in 2022 the financial success of the company will be impressive.
In the last decade, Amazon has grown to a huge scale. The company's sales for 2020 amounted to more than $380 billion, and this is 37.6% more than in the same period last year. The pandemic has literally forced the multimillion-dollar army of humanity to order goods via the Internet with delivery. It must be said that the company has successfully coped with the tasks set, and today customers do not refuse quality services even after the transition of the planet to a normal mode of existence.
Amazon's fiscal year ended in September 2021. According to the reports, the company received $55 billion in profit. This is quite an impressive amount of capital that the company has directed to its own development – the purchase of equipment and real estate, innovation and technology development.
These investments will become another starting point for Amazon, allowing it to reduce the delivery time and add a maximum of convenient and functional services, as well as reduce the cost of services for a number of customers.
By attracting new consumers, the company stimulates an increase in the frequency of purchases, and with them a reduction in prices, increasing customer loyalty and demand for its own services. At the same time, the demand for advertising services is also growing. The last quarter for this division was marked by 49% of profit, which reached $8.1 billion. Over the past 4 quarters, the issuer has earned about $31 billion on advertising services alone.
Amazon clearly adheres to its own rules of development, its assets are worth quite an impressive amount today. In 2022, according to experts, the campaign expects quite a serious growth.