Cloud Computing Investments

The obvious leaders in market share in cloud computing are Amazon(AWS), Microsoft(Azure) and Alphabet(Google Cloud).

Their stock market prices and respectively market capitalisations have done exceptionally well since 2013 when actually cloud computing took off, slowly became mainstream and the community en masse gradually saw the cloud computing efficiencies and realised that cloud computing is the future of computing and productivity.

Other smaller cloud companies's market capitalisations GitLab, HashiCorp, Cloudera, Docusign have risen tremendously in the last 5 years, before falling mostly more than 70 % from their most recent stock prices' peaks approximately one year ago.

Amazon, Microsoft and Alphabet's market capitalisations have declined by around 30 % on average from their most recent peak. The above developments are logical since Amazon, Microsoft and Alphabet's huge cloud revenues, the associated scale and profitability provide a cushion for the institutional investors, which predominantly hold their stocks. This  coupled with the unwillingness of pension funds and large asset management companies to sell their holdings abruptly and thus realise real losses helps explains the relative stability of the large cloud companies.

In my personal opinion, two or three companies like GitLab and HashiCorp can make waves in cloud computing, take a large market share and raise their market capitalisations more than times from current levels.

The rising interest rate levels globally have turned investing in companies active in cloud computing into a binary outcome. "Either you fly or you die". Which translated means the market thinks only several companies will survive and be long-term successful in the cloud computing market.

Actually, I beg to differ. The cloud computing market's annual revenue is projected to surpass 600 billion USD a year after 7 years. When the inherent profitability of cloud computing is taken into account, one can apply a reasonable Price/Sales revenue of 7 to cloud computing long term, which means the whole market capitalisation potential of cloud computing will be 4.2 trillion USD.

Many new established, young entrants and future companies to start in the cloud will be able to benefit from this lucrative opportunity, in my humble opinion.