Magnificent 7 Stocks & Outlook! Apple, Amazon, Alphabet, Microsoft, Meta, Nvidia, Tesla!

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AI Summary

Summary: The Magnificent 7 Performance Overview

• Introduction
  • Daniel from Unrivaled Investing discusses the Magnificent 7’s performance in 2023 and anticipates their 2024 outlook.
  • The Magnificent 7 includes Apple, Microsoft, Alphabet, Amazon, Nvidia, Meta Platforms, and Tesla.
• Performance in 2023
  • Apple was the lowest performer with nearly 50% gains.
  • Nvidia saw over 100% gains, with the group’s performance ranging between 50% and 200%.
• Analysis Approach
  • Daniel focuses on high-level analysis rather than detailed individual stock analysis.
  • He emphasizes that his insights are not financial advice.
• Apple
  • High price-to-earnings ratio gives pause due to declining revenue.
  • Success hinges on new product cycles or AR/VR products.
  • AI ticker chat’s predict feature suggests growth needs to reaccelerate for attractive future returns.
• Microsoft
  • Sales reacceleration noted, with growth above 10%.
  • Diverse business with strong execution and partnerships, like with OpenAI.
  • Potential for adequate returns with maintained or slightly lower profit margins.
• Alphabet
  • Profit margins were contracting but are now stabilizing.
  • Layoffs and AI innovations could impact margins and the economy.
  • Owns a small stake due to AI leadership, despite uncertainties in search and advertising revenue.
• Amazon
  • Impressive revenue growth with seasonal peaks.
  • Investors seek improved operating margins, which have shown recent improvement.
  • Future performance depends on continued margin improvements.
• Nvidia
  • Exceptional growth due to AI Revolution demand for GPUs.
  • Future performance uncertain if growth stabilizes at a lower rate.
• Meta Platforms
  • User base continues to grow.
  • Reality Labs’ losses are significant, but cost management is improving.
  • Advertising business sensitive to economic downturns.
  • VR technology and Zuckerberg’s capital deployment are factors to watch.
• Tesla
  • Elon Musk’s ambitious valuation goals for Tesla.
  • Auto manufacturers are sensitive to economic recessions.
  • Recent video provides more detail on Tesla’s outlook.
• Final Thoughts
  • Daniel prefers smaller investments with higher conviction.
  • Focuses on fundamentals like free cash flow yield and reasonable growth.
  • Upcoming subscriber letter to discuss investment strategies focusing on fundamentals.

For more detailed insights and investment ideas, Daniel invites viewers to check out Unrivaled Investing.