To The Moon

A trillion here, a trillion there...

We’re no longer speculating if a company will reach $1 trillion—that was so 2018. These days, it’s a race to $4 trillion, and two heavyweights—$Microsoft(MSFT)$ and $NVIDIA(NVDA)$—are neck and neck. At the time of writing, Microsoft sits at a market cap of $3.71 trillion, while Nvidia has surged to $3.89 trillion. Apple, the long-time frontrunner, trails at $3.19 trillion but remains a quiet force. But let’s not ask who’ll get there first. The real question is: what must they actually do to justify that kind of valuation?

Three trillionaires. One trillion left to claim

Nvidia’s perfection premium

Nvidia has delivered a dazzling run, ballooning from under $90 a year ago to a 52-week high of $160.98. Its market cap has almost quintupled since late 2022. But this meteoric rise brings one uncomfortable truth—perfection is already priced in.

With a trailing P/E of 51.40 and a forward P/E of 37.17, Nvidia’s valuation assumes it dominates not only the AI infrastructure market but almost everything connected to it. That’s a tough bet to hold. Its price-to-sales ratio of 26.54 is sky-high. For comparison, Microsoft trades at just 13.80. Nvidia’s return on equity is an eye-watering 115.46%, and it holds $53.69 billion in cash. It’s executing almost flawlessly, with a 69.2% year-on-year revenue jump and EBITDA north of $88 billion.

Still, investors have to ask—where does the next wave of growth come from? Enterprise AI adoption won’t remain in hypergrowth forever. If hyperscalers like $Amazon.com(AMZN)$ or $Alphabet(GOOGL)$ continue to develop their own silicon, Nvidia’s margins could feel the pressure. There’s also the possibility of AI demand normalising. Any slip in earnings or guidance—and I mean any—could spark a correction sharper than a Tensor core.

Microsoft’s quiet compounding advantage

Microsoft, by contrast, isn’t quite as flashy—but perhaps more structurally sound. With a current market cap of $3.71 trillion and a stock price just shy of $500, it’s the steady tortoise to Nvidia’s ambitious hare. The company boasts a 35.79% profit margin and a massive $270 billion in trailing twelve-month revenue. It’s not priced for hypergrowth like Nvidia—its forward P/E is a more grounded 33.22—but that makes it easier to justify further upside.

Where Microsoft shines is in leverage. Its investments in OpenAI are beginning to translate into product integration across Azure, Copilot, GitHub, and the broader productivity suite. If those AI tools drive increased adoption across existing customers—and early signs suggest they are—Microsoft doesn’t need to reinvent the wheel to scale further. It just needs to make the wheel a little smarter.

Crucially, Microsoft generates $130.71 billion in operating cash flow and holds nearly $80 billion in cash. It can afford to be patient, strategic, and relentless. That’s not a bad position from which to inch toward $4 trillion.

Their trajectories differ—but the market’s memory is short. This chart shows the race—but not the runway.

Apple’s quiet confidence

Apple’s market cap of $3.19 trillion might make it look like an underdog in this race. But I think it’s playing an entirely different game. While Microsoft and Nvidia throw themselves into infrastructure and enterprise AI, Apple is quietly integrating intelligence into the core of its consumer experience.

Financially, $Apple(AAPL)$ remains a machine. With $400 billion in annual revenue, $138 billion in EBITDA, and nearly $100 billion in profit, it’s as cash-rich as ever. Its return on equity of 138% reflects exceptional capital efficiency. Even without AI moonshots, Apple’s buybacks, dividends, and loyal customer base give it serious staying power—and a credible shot at $4 trillion, one quiet quarter at a time.

Yes, it’s had a rougher ride recently. The stock is down 6.26% over the past year, and its forward P/E of 26.81 suggests more modest growth expectations. But Apple doesn’t need to chase hype. With on-device AI, Vision Pro, and a relentless focus on privacy, it’s aiming to redefine the user experience, not just headline metrics.

An insight you may have missed

Despite its explosive rise, Nvidia still has relatively modest institutional ownership at 67.4%. That’s well below Microsoft’s 74.64%. For long-term investors, this may present a clue: more institutional money could still flow into Nvidia, supporting the stock. But it also signals greater retail enthusiasm—and that can turn quickly if sentiment shifts.

Meanwhile, Apple’s $97.25 billion in free cash flow is quietly doing the heavy lifting. In a market increasingly obsessed with monetising AI, Apple’s strength lies in monetising loyalty—and that remains an underrated asset.

The crown won’t go to the fastest—but the most balanced

Microsoft gets my nod

All three companies are phenomenal. Nvidia has the momentum, Apple has the moat—but Microsoft has the clearest path to sustainable, AI-driven value creation at scale. It’s not about timing the peak. It’s about identifying who can thrive on the other side of it.

Microsoft strikes the best balance between growth, optionality, and durability. It’s already embedded in enterprise workflows, holds the keys to cloud infrastructure, and has the operating discipline to turn innovation into earnings. Nvidia dazzles, Apple endures—but Microsoft might just define the next trillion.

Who gets there first is a headline. Who stays there is the legacy.

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