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Holy smokers guys amazon has just become the second most valuable company in terms of market cap in the entire world they just passed up google google used to hold that spot of number two most valuable company in the world now they were only behind apple the almighty apple and so we got to kind of discuss can they pass apple is that possible and then we kinda got
To discuss like them versus google do they really deserve to be a more valuable company than google in terms of market cap or is this company overvalued so if we kind of think about things for a second let’s think about like google what does google’s business represent okay versus in any amazon okay so google this is a company that dominates search okay they get
The the most popular the most successful search engine in the history of the world still to this day right google also owns youtube youtube is the dominant you know video streaming service whatever you want to call it it’s a dominant video service in the world okay it dominates every other video platform out there youtube then they have the google cloud which is
Also a very big business the small business uses i used to have a google cloud account from my small real estate marketing company big businesses use it all i know snapchat uses a lot of google to store stuff and whatnot a lot of their data they own that they also have android okay they have the android business which is obviously the second no i would say it’s
Actually the most popular platform in the entire world as far as i’m for smart phones and whatnot so they got all these massive businesses they have a massive search business they got youtube the most popular video platform in the world they got obviously cloud they’ve got android and they’ve got a lot of other like smaller stuff right well that was a flipside you
Kind of look at it from amazon’s perspective oh and by the way one one last thing about google versus amazon is google’s gonna make somewhere around twenty to twenty five billion dollars in profit this year okay somewhere around twenty to twenty five billion dollars in profit in 2018 guys that’s a extraordinary amount whereas amazon is probably gonna make between
Three and five billion dollars in profit so if you’re looking at just the profit obviously google dominates amazon and by the way apple just made 20 billion dollars in profit in their last quarter and their last quarter that’s probably why you know was the other passe apple anytime soon but let’s talk about amazon so the first thing you got to think about when you
Think about amazon is that they have one retail okay they have one the retail war that is the next war which is online everybody else now at this point is fighting for second place okay everybody else is fighting for second place they’ve won and the way i kind of view in mazon you know i think the way a lot of investors view amazon is they’re gonna be like walmart
On steroids and when it comes to retail what walmart represented in the physical retail game right the dominance walmart had right i think amazon’s gonna have that in online but even to a bigger scale and it’s obvious they’re gonna be number one everyone else is gonna be fighting over number two who’s gonna be the number two long-term who would be walmart will be
Target well the ebay will be an upstart who knows you know that’s up for debate but it is very clear that amazon has one retail in the online space and they’re gonna be the winner there right then you gotta think about it they got amazon web services okay amazon web services which is you know has a lot to do with the cloud and whatnot in tons of small companies
And big companies have started using amazon web services in his head become like an integral part of their company okay so something they don’t even want to break up with and i’ve amazon’s starting to make a lot of money from this business guys and this is a business it could be a huge profit machine for the company moving forward alright so this is this is going
To be a monster business a business that’s not even that old that amazon started it’s now become one of the biggest companies in the world if it was its own company right then you’ve got to think about it from the perspective of food they have a great opportunity to dominate food if they’re already going to dominate on online retail right they’re going to be in a
Great position to dominate online food retail people placing orders who knows if they’ll win that they just bought whole foods this past year which is you know obviously the the best and biggest as far as the org gaiman food so the jury’s still out on if they can win that but it’s a possibility out there and if they could win that that’s another huge opportunity
All right then we think about the smart home okay the smart home that’s something we we you know have heard you know talked about for years now smart home devices in your home makes it a smart home and whatnot they they might end up actually winning the smart home game even though they’re not a pure electronics company okay so they’ve gotten obviously the most
Dominant device in homes which is the amazon echo right which is listen and i got one in the kitchen that someone got us right and and those devices are in the home and they’re waiting for your command and you could do things with them and whatnot that’s like the dominant speaker slash whatever you want to call it you know virtual assistant out there and they’re
Building on that platform and that’s what most people have in their homes okay they just bought ring which is a doorbell company that has cameras and whatnot that’s another device there they’re there they’re exploring all these options and all these things obviously they’re probably the second biggest player in the tablet game with all their fire tablets so they’re
Really concentrated on smart home getting devices into your home they you know they try to compete in smart phones and things like that they couldn’t they couldn’t do it there but a lot of these other little devices that may be you know the the big dog electronics companies aren’t quite as focused around i mean look at apple and look at samsung you know look at
How long it’s taken them to come out with you know external speakers and things like that like apple just finally got theirs on the market what a month ago amazon’s had amazon echoes in homes now for years and years guys so they’ve they’ve kind of jumped out in the lead in my opinion in the smartphone and they have a great opportunity to win that so that is big
So when you look at these you’ve got to kind of think to yourself you know what could these bring in some day we know google search which is its main business right it’s pretty much topped out like there’s not much room for growth in google search moving forward at this point in time so that’s the bad thing we do know that youtube will continue to be a cash cow for
Google for many many years to come and it’s a dominant video platform so that’s good we know the cloud business will continue to build out although there’s a lot of competitors there we know android is pretty much topped out as far as the amount of devices that you can get out there right now it’s just kind of like a replacement cycle so that’s somewhat topped out
So if you look their main businesses topped out one of their other main businesses topped out yeah they can get some more growth certainly out of youtube they can get some more growth growth out of the cloud but that’s a very competitive space there so google it’s not seen nearly as much of a growth engine moving forward as something like amazon which you know
They’re already in the lead here but there’s so much more room over the next 5-10 years for them to grow in retail it’s it’s incredible right it was on web services that’s a company that is growing massively and that’s gonna be able to grow for another five ten years strong growth okay food is a huge potential you know thing for them out there whether they can win
The food game is is a question out there but the fact that they have that opportunity is huge and then smart home as a massive growing segment right there and they have and my opinion that you could make an argument that they literally are the leaders and smart home devices homes that are going in people’s or devices that are going in people’s homes right now so
It’s it’s pretty incredible and that’s why you know a company like amazon that might only make between 3 and 5 billion dollars next year versus a company like google that’s gonna bring in 20 to 25 billion that’s why company like amazon can be valued as the second most valuable company because they have all these potential growth vectors that are massive things where
Google is kind of like oh man this business your main business this could be in decline soon right especially the more voice searches and whatnot you know think about if you search something with your voice there’s a totally different experience and guess what you don’t even see if you search something with your voice you don’t see those ads that pop up which you if
Google needs people to be clicking on those ads and those adwords and whatnot so they can get paid so that’s a big big factor there guys it’s a big big factor so you know it definitely makes sense why an amazon would pass them and despite not being nearly as profitable so even though the value side of me would say in a world that’s all good and straight we should
Just have you know a company that’s not as profitable a lower ranked another company that is is profitable but that’s just not the way the stock market works it’s all about growth going forward and i’m kind of what your valuation is very now based upon that guy so but as far as passing apple i don’t think amazon is gonna be able to pass apple anytime soon because
Apple is so far out in front in profits and they will keep expanding those profits over the next 3-5 years that i do not see amazon passing apple at least it is over the next few years it’s possible someday i think apple will be the first company to a trillion-dollar market cap but do i think amazon is gonna reach each other you know in market cap absolutely it
Could happen within a year or two but do i think it’s gonna get to a place where they have a bigger market captain apple i do not think so at least over the next few years longer term we all have to see but i really want to know your guys opinion on this do you think amazon should be the second most valuable company in the world like what’s your opinion on that do
You think google should still be you know higher valued than that i would love to hear from you guys do you think amazon is gonna take over that number one spot anyways let me know in that comment section what you guys think there thank you for watching and have a great today
Transcribed from video
Amazon Becomes 2nd Most Valuable Company in the World Today! How come? By Financial Education