As not all brokers offer fractional shares of stocks, it's important for retail investors to know what stocks may be difficult to trade due to the high price of each share. These trading implications can matter (even though stock price does not necessarily correspond to the value of a company).
Because a company's total market capitalization is a product of both its share price and the number of shares issued, the stock price alone tells you little about how overvalued or undervalued a given stock may be.
There are the top five highest-priced stocks that trade in the U.S., as of Aug. 10, 2021, excluding those sold only on over-the-counter (OTC) markets.
- A stock price doesn't necessarily reflect the value of the company.
- Some companies have a low number of shares, and therefore a higher price per share in the market.
- Some of the highest-priced stocks available on U.S. exchanges include Berkshire Hathaway Inc., NVR Inc., Amazon.com Inc., Alphabet Inc., and Booking Holdings.
- A company's value and share price should be analyzed using fundamentals.
1. Berkshire Hathaway Inc. (BRK.A)
- Stock price: $433,789.38
- Market capitalization: $657.679 billion
Berkshire Hathaway has the highest-priced shares of any U.S. company, and is also one of the largest companies in the world, consistently ranking in the top 10 by market value.
Berkshire was originally a textile company, but was bought by Warren Buffett and is now a holding company for his investments. Among its many holdings are the GEICO insurance company, the BNSF Railroad, and the Lubrizol chemical company.
As its CEO, Buffett has famously resisted splitting Berkshire's shares, something companies normally do to make it easier to trade their stock. Buffett instead has kept the price high to make it harder to trade, and thus discourage short-term trading which would increase the stock's volatility.
However, in 1996, Berkshire launched a new share class (BRK.B), which has a lower price. This allows people to purchase much smaller chunks of the company. They trade for a much more accessible $288.95 (as of August 10, 2021).
2. NVR Inc. (NVR)
- Stock price: $5,180
- Market capitalization: $18.438 billion
NVR is a homebuilder and mortgage banking company based in Virginia. Some of the company's subsidiaries include Ryan Homes, Fox Ridge Homes, and NVR Mortgage. NVR Inc. has also never split its stock.
3. Amazon.com Inc. (AMZN)
- Stock price: $3,325.07
- Market capitalization: $1.6 trillion
Amazon started as an online retailer of books and expanded until it is now an online retailer for virtually everything. In addition to its enormous e-commerce business, Amazon has a dominant position in the cloud computing services industry via Amazon Web Services.
Amazon is one of a handful of companies to exceed $1 trillion in valuation and is consistently among the top five most valuable companies on earth. This enormous size is what gives it a place on this list—despite having undergone three separate stock splits in the late 1990s, which increased its share count by ten-fold.
4. Alphabet Inc. (GOOG)
- Stock Price: $2,754.56
- Market Capitalization: $1.834 trillion
Alphabet Inc. was originally founded as a search engine company in 1998; its original name was Google Inc. Since then, it has become the world's most popular search engine. After a reorganization in 2015, it created the holding company Alphabet Inc.
Alphabet's revenue comes from its Google search engine, YouTube, Google Play, Google Cloud, Chrome browser, and its Android mobile operating system.
5. Booking Holdings (BKNG)
- Stock Price: $2,200.47
- Market Capitalization: $90.351 billion
Booking Holdings is the world's largest online travel agency. It operates these websites: Priceline.com, Booking.com, Agoda, OpenTable, RentalCars.com, Kayak, and Momondo Brands.