5 Near Monopoly Stocks in the US

In this article, we will take a look at the 5 near monopoly stocks in the US. If you want to see more stocks in this selection, go to the 10 Near Monopoly Stocks in the US.

5. Apple Inc. (NASDAQ:AAPL)

Number of Hedge Fund Holders: 140

Apple Inc. (NASDAQ:AAPL) is a Cupertino, California-based diversified technology company that has the distinction of being the biggest company in the world in terms of market capitalization.

The company holds a near monopoly status in the fields of mobile application stores and mobile operating systems. Furthermore, the company is one of the market leaders in the web browser segment, along with Alphabet Inc. (NASDAQ:GOOGL), Microsoft Corporation (NASDAQ:MSFT), and Mozilla. The European Union (EU) has forced the company to allow other application stores to operate on its iPhones, and this regulation will come into force in 2024. Apple Inc. (NASDAQ:AAPL) stock is also the biggest holding in the portfolio of Warren Buffett’s Berkshire Hathaway Inc. (NYSE:BRK-B) as of Q3 2022.

Here’s what Wedgewood Partners said about Apple Inc. (NASDAQ:AAPL) in its Q3 2022 investor:

“Apple Inc. (NASDAQ:AAPL) grew revenues +5% (foreign exchange adjusted and excluding Russia) driven by record iPhone revenues that were up about +3% on an exceptional year ago comparison of +50%. Apple’s installed base is over 1.8 billion devices which helps drive a software and services business that has generated almost $80 billion of revenue over the past 4 quarters. As we have highlighted in the past, Apple’s relentless focus on the development and integration between hardware (especially ICs) as well as software, continues to add significant value for customers of its products and services. We expect this favorable competitive dynamic to continue for the foreseeable future.”

4. Meta Platforms, Inc. (NASDAQ:META)

Number of Hedge Fund Holders: 177

Meta Platforms, Inc. (NASDAQ:META) is a Menlo Park, California-based diversified technology company that has significant clout over the social media and messaging industry by owning Facebook, Instagram, and WhatsApp.

Originally, Meta Platforms, Inc. (NASDAQ:META) developed Facebook internally but established its near monopoly position in the social media industry by acquiring Instagram for $1 billion in 2012 and WhatsApp for $14 billion in 2014. Meta Platform’s CEO, Mark Zuckerberg, was called in front of Congress in July 2020. Following a five-and-a-half-hour session with him and CEOs of other leading tech companies, the subcommittee concluded that the Big Tech companies had become a monopoly. Some of them may need to be broken up to end their hegemony over their respective industries. Furthermore, proper regulatory measures need to be taken to update the anti-trust laws that were drafted nearly 100 years ago.

Here’s what ClearBridge Investments said about Meta Platforms, Inc. (NASDAQ:META) in its Q3 2022 investor letter:

“We initiated a new position in Meta Platforms, Inc. (NASDAQ:META), in the communication services sector, which operates the Facebook and Instagram social media platforms and is a leading digital advertising provider. We have been carefully watching the company over the last few quarters and believe headwinds from lower monetizing in Facebook and Instagram Reels and pressures from consumer privacy measures are poised to lessen. We believe the company has begun to fully acclimate to this new environment, will achieve greater effectiveness in Reels monetization and find ways to adapt to new privacy standards which will rebound advertising efficiency. Combined with a greater focus on cost control, we believe these initiatives will help contribute to further margin expansion and leave the company well-positioned moving forward.”

3. Alphabet Inc. (NASDAQ:GOOGL)

Number of Hedge Fund Holders: 196

Alphabet Inc. (NASDAQ:GOOGL) is a Mountain View, California-based diversified technology company that holds a monopoly or near monopoly position over mobile application stores, mobile operating systems, search engines, web browsers, search advertising, and cloud computing segments.

Together with Apple, Alphabet Inc.’s Android mobile operating system holds a 99% market share as of 2022. Both these entities hold a 100% market in the mobile application stores category. Along with Microsoft Corporation (NASDAQ:MSFT), Google holds a 97% market share in the web browser segment. Meanwhile, 92% market share in the field of search advertising is held by Alphabet Inc. (NASDAQ:GOOGL), Amazon.com, Inc. (NASDAQ:AMZN), and Microsoft Corporation (NASDAQ:MSFT). According to experts, the disruption by Google in the search advertising industry has automated various tasks and has resulted in a job loss of 199,000 people globally.

Stewart Asset Management discussed its stance on Alphabet Inc. (NASDAQ:GOOGL) in its Q3 2022 investor letter. Here’s what the firm said:

“We invest in businesses with strong, resilient earnings growth which are less cyclical. In the pandemic recession of 2020, the aggregate earnings of the portfolios we manage did not decline year-over-year, and in fact grew, albeit modestly. Looking at the Great Recession which began at year-end 2007 and lasted to mid-year 2009 is helpful too. Our four largest current holdings in the portfolio weathered that period well. Alphabet (NASDAQ:GOOG), then called Google, reported earnings that doubled from 2007 to 2010.”

2. Amazon.com, Inc. (NASDAQ:AMZN)

Number of Hedge Fund Holders: 269

Amazon.com, Inc. (NASDAQ:AMZN) is a Seattle, Washington-based technology company founded by Jeff Bezos in 1994. The company has become a mainstay in the lives of Americans through its e-commerce offerings.

Amazon.com, Inc.’s (NASDAQ:AMZN) marketplace provides more reach to merchants as compared to other platforms, as it has a nearly 60% market share in the US e-commerce industry, according to PYMNTS. The lockdowns and restrictions during the COVID-19 pandemic saw a strong shift from in-store purchases to e-commerce buying. In a research note issued to investors on December 13, Brian Fitzgerald at Wells Fargo highlighted that the gross merchandise value (GMV) for Amazon.com, Inc. (NASDAQ:AMZN) has started to re-accelerate. The company holds a near monopoly position in the cloud computing segment through its Amazon Web Services (AWS) offering.

Here’s what Farnam Street Investments said about Amazon.com, Inc. (NASDAQ:AMZN) in its Q3 2022 investor letter:

“Change doesn’t just impact investors. Business people also bet for or against change. Jeff Bezos was once asked this exact question:

“You can build a business strategy around the things that are stable in time. It’s impossible to imagine a future ten years from now where a customer comes up and says, ‘Jeff, I love Amazon, I just wish the prices were a little higher.’ Or, ‘I love Amazon, I just wish you’d deliver a little slower.’ Impossible. So we know the energy we put into these things today will still be paying off dividends ten years from now. When you have something you know is true, you can afford to put a lot of energy into it.”

A lot of energy… and more than $172 billion in capital expenditure in the last fifteen years.

Deeper, slower moving layers turn exponential growth into “S-curves.” A rapidly dividing bacteria crashes into the resource-wall of its Petri dish. Nineteenth-century commercial robber barons were smacked by the governance layer of the Sherman Antitrust act. Amazon (NASDAQ:AMZN) Prime free shipping leaned on the creaking infrastructure of the U.S. Postal Service until it was forced to invest in its own infrastructure (all those delivery vans you see driving around).

Hopefully, next time you’re thinking about change, you can recall pace layers as a helpful construct to understand how successful systems change.

1. Microsoft Corporation (NASDAQ:MSFT)

Number of Hedge Fund Holders: 269

Microsoft Corporation (NASDAQ:MSFT) is a Washington-based diversified technology corporation that holds a near monopoly position in the desktop operating system (OS) with a market share of 76% as of 2022. The company also holds a significant market share in the cloud computing segment through its Azure offering.

Microsoft Corporation (NASDAQ:MSFT) is now focused on creating the complete video game ecosystem through conventional and cloud mediums as it is in the middle of the $69 billion acquisition of Activision Blizzard, Inc. (NASDAQ:ATVI). The Santa Monica, California-based entity is the biggest video game publisher in the world. This has been widely discussed by the Federal Trade Commission (FTC) during the review of the Microsoft-Activision deal. The deal has also irked Sony Group Corporation (NYSE:SONY), the PlayStation gaming console maker. According to Microsoft Corporation (NASDAQ:MSFT) three billion people play video games currently, and this number will rise to 4.5 billion by the end of this decade.

Carillon Tower Advisers shared its stance on Microsoft Corporation (NASDAQ:MSFT) in its Q3 2022 investor letter. Here’s what the firm said:

“Despite reporting very good quarterly results, Microsoft Corporation (NASDAQ:MSFT) underperformed the overall market in August. Technology stocks in general underperformed in August due to fears over slowing global economic growth, potentially leading to cuts in corporate information technology budgets.”

You can also take a peek at the Dividend Champions List By Yield and 15 Best NASDAQ Stocks To Buy.

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