TSLA vs. AAPL vs. MSFT: Which Magnificent 7 Stock Is Wall Street's Best Pick?
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Tesla (NASDAQ:TSLA) Stock
Shares of electric vehicle (EV) Tesla have advanced about 10% over the past month, but are still down about 16% year-to-date. Tesla bulls are confident about the company's ability to navigate short-term challenges and capture opportunities in the full self-driving (FSD), robotaxi, and robotics areas.
However, some analysts are concerned about persistent weakness in Tesla's deliveries due to intense competition and macro woes, disappointing financials, backlash associated with Musk's political activities, and loss of EV credits. Overall, Tesla needs to revive its core auto business and win back investors' confidence by improving its financials and capturing opportunities in growth areas like robotaxis.
What Is the Price Target for Tesla Stock?
Recently, Wolfe Research analyst Emmanuel Rosner reiterated a Hold rating on Tesla stock. Rosner noted TSLA stock's underperformance compared to the broader market on a year-to-date basis. The analyst believes that near-term, Street estimates still appear high, especially for 2025 and 2026. He expects Tesla's free cash flow to remain under pressure, with strong growth in the company's 'burgeoning Energy business a key swing factor.'
However, Rosner thinks that Tesla trades more around the narrative than the numbers, and net-net, he 'tactically' expects an improving narrative from here. He noted that Tesla has several catalysts coming, including FSD and robotaxi, as well as an expansion of the company's autonomous vehicle (AV) service into several new U.S. markets, such as San Francisco, Nevada, and Arizona. Rosner also noted Tesla's other growth initiatives, including the launch of supervised FSD in China and Europe over the next 12 months and the expansion of Optimus production in 2026.
Overall, Wall Street has a Hold consensus rating on Tesla stock based on 14 Buys, 15 Holds, and eight Sell recommendations. The average TSLA stock price target of $307.23 indicates a possible downside of 9.4% from current levels.
Apple (NASDAQ:AAPL) Stock
iPhone maker Apple recently reported better-than-expected results for the third quarter of Fiscal 2025 (June quarter). Notably, iPhone sales jumped 13% and Apple's overall revenue rose 10%, marking the company's largest quarterly top-line growth since December 2021. The tech giant expects its overall revenue growth in the September quarter to be in the mid- to high-single-digit range, with services expected to increase at a similar rate to Q3 FY25's 13% year-over-year growth.
Apple stock has risen about 12% over the past five trading sessions, as investors cheered CEO Tim Cook's recent meeting with President Donald Trump to announce the company's plans to invest $100 billion in America over the next four years. This brings Apple's total commitment to $600 billion.
The move pleased President Trump, who announced that Apple would be exempt from future tariffs that could double the price of imported chips. However, AAPL stock is still down 9.3% year-to-date, as investors are concerned about the company falling behind in the AI race and intense competition in the smartphone market.
Is Apple a Buy, Sell, or Hold?
Following the announcement of Apple's increased investment in the U.S., Bank of America Securities analyst Wamsi Mohan increased the price target for AAPL stock to $250 from $240 and reaffirmed a Buy rating. The 5-star analyst stated that Apple's increased investments in the U.S. could result in several of its products being exempted from tariffs. Furthermore, Mohan believes there is the potential for Apple to gain smartphone market share in the U.S. if competitors are subjected to tariffs while iPhones remain exempt.
He expects Apple's gross margin to gain from potential tariff relief, with the December quarter gross margin expected to benefit from forex-related tailwinds as well. Mohan stated that he now has increased confidence in Apple's EPS to be more than $8 in calendar year 2026. Mohan assigned a higher multiple to Apple stock to reflect increased optimism about the company's profitability from supply chain investments. He remains bullish on AAPL stock due to stable cash flows, earnings resiliency, and a solid capital returns program.
Wall Street has a Moderate Buy consensus rating on Apple stock based on 16 Buys, 12 Holds, and one Sell recommendation. The average AAPL stock price target of $235.14 indicates 3.5% upside potential.
Microsoft (NASDAQ:MSFT) Stock
Microsoft stock has risen about 24% year-to-date, as investors are upbeat about the company's growth potential and AI-led growth in the Azure cloud business. The company's significant investments are helping to capture the robust demand for AI infrastructure.
Notably, Microsoft recently reported impressive results for the fourth quarter of Fiscal 2025, thanks to demand for cloud services and AI strength. Notably, revenue from Microsoft Azure and other cloud services grew 39% (at constant currency). In fact, Azure revenue rose 34% to surpass $75 billion in the full year. Looking ahead, the company is poised to gain from the generative AI boom.
Is Microsoft a Buy, Hold, or Sell?
Impressed by the Q4 print, Cantor Fitzgerald analyst Thomas Blakey increased the price target for Microsoft stock to $639 from $581 and reiterated a Buy rating. The 4-star analyst noted that the fiscal fourth quarter witnessed demand acceleration. Blakey highlighted that demand continued to outstrip supply for cloud services, with the equilibrium once expected for the end of Fiscal 2025 pushed out to the end of calendar 2026.
He added that Azure's solid performance was driven by Microsoft's largest customers' core infrastructure business as new cloud and AI workloads are built and scale across services. He pointed out Microsoft's commentary about migrations remaining strong as customers increased modernization efforts, likely related to AI.
With 34 Buys versus one Hold recommendation, Microsoft scores a Strong Buy consensus rating on TipRanks. The average MSFT stock price target of $623.34 indicates 19.5% upside potential from current levels.
Conclusion
Wall Street is highly bullish on Microsoft stock, cautiously optimistic on Apple stock, and sidelined on Tesla stock. Analysts see higher upside potential in MSFT stock than in the other two Magnificent 7 stocks discussed here. Wall Street is optimistic about Microsoft due to its diversified business model and robust demand for cloud computing and AI tools. Microsoft is well-positioned to deliver solid growth and impressive margins.
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