FYI, that’s a bit of an apples-to-oranges comparison. GDP is measured in annual income, whereas market cap is a risk-adjusted present value discount of ALL expected future income. Market cap is more analogous to the value of an asset if you wanted to make the comparison. Alternatively, Microsoft last year had 143 billion USD in earnings, that would be the right comparison to Italy’s GDP.
Right now you are paying for 35 years of earnings during which time they’ll net the gdp of italy plus or minus whatever they grow by. If this wasn’t money printing clown world, you would have to rationalise your investment by assuming that they will grow their market cap to be about twice the gdp of japan of in the next 5 - 10 years. But owning an asset like msft which generates a ton of cash and is growing earnings makes sense if you expect the dollar to eat a shit sandwich.
p.s. they had annual net income for 2020 was $44.281B on revenue of 143B
FYI, that’s a bit of an apples-to-oranges comparison. GDP is measured in annual income, whereas market cap is a risk-adjusted present value discount of ALL expected future income. Market cap is more analogous to the value of an asset if you wanted to make the comparison. Alternatively, Microsoft last year had 143 billion USD in earnings, that would be the right comparison to Italy’s GDP.
Right now you are paying for 35 years of earnings during which time they’ll net the gdp of italy plus or minus whatever they grow by. If this wasn’t money printing clown world, you would have to rationalise your investment by assuming that they will grow their market cap to be about twice the gdp of japan of in the next 5 - 10 years. But owning an asset like msft which generates a ton of cash and is growing earnings makes sense if you expect the dollar to eat a shit sandwich.
p.s. they had annual net income for 2020 was $44.281B on revenue of 143B