What could the net income of the top fifteen public companies afford? Accounting for tax, dividends and loan payments

Originally Published: February 7, 2021

For the past several weeks I haven’t been able to get one, simple, basic thought out of my head. It’s become the ever present background noise of my life. Driving? Yep. Showering? Yep. Eating? Yep. Trying to sleep? Yep. Procrastinating on making this very article but because there is no deadline simply making no progress yet being sad that it’s not being made? You bet.

And that thought is this simple idea:

What could the net income of the top fifteen public companies afford accounting for tax, dividends and loan payments?

Okay I will admit, it’s not a very simple idea, especially not as simple as I set it out to be. But it is a good question, no? I mean, we’re working with astronomical numbers here, and it’s all liquid revenue that can be used, essentially, however the Board of Directors choose!

Here’s some perspective: at the end of 2019, Amazon.com reported an annual net income of Eleven-and-a-Half Billion dollars. Let’s do some math to put that into perspective: You work a job that pays $100/hr, 40 hours a week, 52 weeks a year. That comes to a total, before expenses, of $208,000. It would take you, assuming zero expenses and no hours unpaid, Fifty-Five Thousand years. And, mind you, Amazon’s 11 Billion annual income isn’t within the top fifteen companies I’ll be covering today.

Regarding coverage, here’s the list of companies I’ll cover, their net income for 2019, and how many years it would take you to equal that amount. (In descending order)

Company Name            Net Income (2019)   Years of Work

Berkshire Hathaway   $81.4B                           290,714

Apple                               $55.2B                           265,384

Microsoft                        $39.2B                           188,461

JPMorgan Chase           $36.4B                           175,000

Alphabet(Google)        $27.4B                           131,730

Bank of America          $21.0B                           100,961

Intel                                 $19.5B                           93,750

Wells Fargo                   $19.4B                           93,269

Citigroup                        $19.2B                           92,307

Verizon                           $18.4B                           88,461

Facebook                       $16.2B                           77,884

Pfizer                              $15.1B                           72,596

Walmart                        $14.8B                           71,153

Exxon Mobil                 $14.3B                           68,750

Fannie Mae                   $14.1B                           67,788

Source: Forbes Fortune 500 2019

(I hadn’t heard of Fannie Mae either. They’re a home mortgage company.)

So now he have this big table of all the companies we’re talking into account today. Next up, we are going to total all the numbers above. Figure out what we need to take from the total, and finally, list what we can afford.

So first off, the grand total Net Income of the top 15 global companies. This comes out to a whopping Four-hundred-and-Eleven-point-Six Billion Dollars. ($411,600,000,000 | $CAD522,500,000,000 | £299,440,000,000 | €388,340,000,000)

That, by the way, would take you nearly 700,000 years to equal.

Alright, now with our $400 billion secured it’s time to figure out where all if it’s ought to go and how much we’ll have left once it’s been spent.

Net income is mostly used in 4 ways, only 3 of which we’ll consider today. They’re the following: Paying off debt – Most companies take out loans in order to not put the full cost of a project up at the beginning, so I’ll say that we’re putting ~10% of our income towards that. Reinvestment into the company – This essentially just accounts for any part of the Net income used for just about exactly what it sounds like. This could be things like stock buybacks, renovating and building locations, that sort of thing. I say this would take ~17% of our profits here. Paying out dividends – This one is especially tricky since some companies, Amazon for example, doesn’t pay out dividends at all. So with some of these companies potentially simply not paying any dividends I think it’s safe to say that only ~7% of our total will be put there.

That brings the total percentage of our profits being used by default to ~34%. I’ll round to a clean third, so 33% is what I’ll be taking from out 411 Billion total.

That cuts us all the way down from $411.6 Billion to a mere $275.8 Billion. To be fair that is quite the reduction, taking a whole $135 Billion away from our total here.

And now, finally, time for the full list:

For the biggest single expense, you could have bought out any of the Fortune 500 companies, with only the top eleven most valuable being outside of your reach, and the most valuable of these being Bank of America, at $266 Billion total worth.

The next thing I thought of, as well as the first actual material possession, was airports. And boy was I not prepared for how incredibly cost-effective airports prove to be.

To put into perspective how cheap airports are, the most expensive airport project in the world is the Daxing International Airport in Beijing, which only cost $63 Billion to build!

Now, I know how big of a number that may look like, but we could buy four of these and still have money left over. However, that $63 Billion figure is a bit inaccurate as the airport itself didn’t cost that much. Rather, it only cost $17 Billion, with another $46.2 Billion in related projects grouped in with the airport.

Using the $17 Billion figure, we could now buy the thing 16 times over. And just considering the cost of the airport itself, Daxing drops out of the #1 spot for Airport costs.

Rather, we now have to look at the Kansai International Airport in Osaka. That project cost $20 billion, with future expansions being planned that will make that cost go up. That airport, mind you, is literally it’s own island. And we have enough money to build it nearly fourteen times.

Any other airports I could find as being considerably expensive aren’t even worth serious consideration. Hong Kong International sits at the same cost, and after that it seems to drop $8 Billion with Al Maktoum International in Dubai, which we could buy 23 times.

Next up, I considered, if airports weren’t all they claim to be in cost, then what about the standard waterport? After all, they have to account for water, which I can barely keep in the sink when I’m washing my hands.

Now, for whatever reason, no one has collected the most expensive sea ports in the world to present to me in a fashion fit for my unique style of research. So instead, I thought to go by cargo volume. After all, the more cargo a port serves, the more it must have cost to build, right?

Going by that metric, the largest of these is the Port of Shanghai.

Now, finding a cost for building this was a bit… Tricky to say the least. It appears as if “The port of Shanghai” isn’t actually referring to a single port facility. Rather, it appears to refer to the general area around the mouth of the Yangtze River.

Because of the seemingly vague nature of what;s considered the “Port of Shanghai” I will instead be using the cost of it’s largest sea port; the Yangshan Port.

The cost for constructing the Yangshan Port totaled a mere $11 Billion. We could build 25 of the things and still have a few million left.

Next up I tried the Port of Singapore. Maybe that would have a concrete cost and definition. I got half of what I wanted. It does appear as if the Port of Singapore does refer to a single harbor, however due to the long and complex history of it, finding the exact cost would be… Difficult. Rather, I chose to skip it and see what else I could find.

Port of Tianjin? No Data. Port of Guangzhou? No Data. Port of Rotterdam? Almost less than nothing.

The problem with most of the world’s biggest Seaports is that they’re less single projects that are built once and then expended upon, but rather a site that has a history so long and potentially fiscally undocumented that finding what it would cost to replicate them is near impossible.

So next I had to consider a project that had a single core cost. One that wasn’t built on by hundreds of years of expansion and development. One that would be large enough to potentially make our balance here flinch. One that was well-documented. One that I like to call the United States Interstate Freeway System.

While it is true that the freeway system has seen many expansions and upgrades over time, with the adjustment of intersections, the adding of new freeways and arterial routes, the core cost of the project is still concrete. So what exactly are we looking at?

Well you need not be disappointed like with the disappointing harbors, for we have a concrete dollar amount to look at.

$129 Billion.

One-hundred-and-twenty-nine-billion.

And we could do it twice.

Granted, this was a somewhat incomplete figure measures in 1991. However, I think it gets the point across. We can buy the Interstate Highway System two times over.

But we have yet to reach our peak.

For you see, we’ve sent a bunch of expensive research equipment, via other expensive equipment, into space and made people live there.

I am talking, of course, about the International Space Station.

The ISS, as of right now, has had an accumulated cost of $150 Billion. A cost which we, for now, cannot afford to do more than once. It would actually put us just over $24 Billion in debt.

We have finally been defeated…

But hey we can still afford scads of Galaxy S21 Ultras!

(“Scads…” what a strange word. It means to have a large quantity.)