What’s the world’s largest company? The answer may not be as cut-and-dried as it seems. Let’s untie a strange, tangled knot right now.
OK, so you’ve seen the epic market-cap duel between Apple Inc. (NASDAQ:AAPL) and Exxon Mobil Corporation (NYSE:XOM). The Dow Jones Industrial Average has risen 19% over the last year, leaving both stocks in the dust. But Exxon managed to eke out a 5% positive change, while Apple’s market cap took a 31% haircut.
Exxon’s market cap has largely ranged between $300 billion and $500 billion for the past nine years, while Apple is a relative latecomer to the $300 billion club. Apple stock crossed that benchmark level on the first trading day of 2011.
So the oil giant is on top right now with a $410 billion market cap. Cupertino topped $600 billion last year but has fallen back to just $390 billion today, losing the crown back to Exxon.
But what about Berkshire Hathaway Inc. (NYSE:BRK.B), then? Run over to Google Finance and you’ll find Berkshire’s “A” shares listed at a $284 billion market cap, while “B” shares get a $283 billion price tag.
Doesn’t that add up to $567 billion, far surpassing both Exxon and Apple?
Not so fast, my friend. It’s time to double-check our data. Take a trip down to Yahoo! Finance instead, and you’ll find Berkshire “A” listed at $284 billion, while “B” shares get a minuscule $189 million market cap. Add all of it up, and “B” shares become a mere rounding error next to their “A”-class cousins.
What’s going on here?
Yahoo seems to lump “A” and “B” share counts into one big pile, listing both classes as 1.65 million shares outstanding. Multiply that collection by the astronomical $172,500 value of “A”-class shares, and you indeed arrive at $284 billion. Using the far smaller $115 price of class “B” shares results in the much smaller $189 million destination.
Confusion still abounds. Google Finance prefers listing each share count separately, with 1.65 million class “A” stubs and 2.47 billion “B” shares outstanding. Multiply these counts by their respective share prices, and you land at the $284 billion valuation.
What’s going on here? Let’s dive into Berkshire Hathaway Inc. (NYSE:BRK-B)’s SEC filings instead. Berkshire Hathaway’s latest 10-Q filing is as close to the source as we’ll ever get. Yes, there’s only one: Berkshire may trade in two stock classes and operate under dozens of brand names, but it still reports results as a single entity.