Latest news with #MagSeven
Yahoo
a day ago
- Business
- Yahoo
The Magnificent Seven Stocks Staged a Blistering May Rally. What's Next?
The Magnificent Seven gained more than 13% last month, making the group of big tech stocks one of the best-performing corners of financial markets in May. The group is still trading in the red for the year, but stocks could get a boost from Apple's Worldwide Developers Conference and Tesla's scheduled robotaxi rollout this month. After rebounding from their post-"Liberation Day" slump, tech valuations have returned to historically high Magnificent Seven had a strong May, but the group remains in the red for 2025. What's next? Taken together, the seven big tech stocks—names like Nvidia (NVDA), Tesla (TSLA), Meta Platforms (META) and more—outperformed dozens of other assets tracked by Deutsche Bank analyst Henry Allen last month. The group saw their stocks rise more than 13% in aggregate in May, their biggest monthly gain in 2 years, according to Allen. Nonetheless, the group remains one of the few corners of global markets lower since the start of the year. Of 32 different sets of investments tracked by Allen—including global equity indexes, government and corporate bonds, foreign exchange indexes, and commodities—only one other asset, crude oil, is negative for the year. Whether the Mag Seven can climb into positive territory this month could depend on what Wall Street thinks of a few upcoming corporate events. Apple (AAPL) will host its Worldwide Developers Conference on June 9. The iPhone maker is expected to unveil a software development kit that helps outside developers build features with Apple Intelligence's underlying large language models. That would effectively let Apple outsource some of the work of building AI products for its devices, which could help close the perceived gap in AI capabilities between it and major peers. And around the middle of the month, Tesla (TSLA) is expected to roll out its robotaxi service in Austin, Texas, in what could be a major test of the company's autonomous vehicle ambitions. Apple and Tesla are the worst-performing stocks in the Mag Seven so far this year, with their shares down about 20% and 16%, respectively. Investor enthusiasm about the companies' progress in some emerging areas seen as vital could help lift their shares. Bank of America analysts on Monday upgraded the information technology sector—home to Microsoft (MSFT), Nvidia, and Broadcom (AVGO), the latter a non-Magnificent stock—to neutral from underweight, and downgraded communications services—including Alphabet (GOOG) and Meta—to underweight from neutral. They cited active funds' historically low exposure to IT and high exposure to communications, as well as the communications and media industry's comparatively unpredictable revenue streams. Perceived recession risks have decreased in the last month thanks to easing tensions between the U.S. and China. Lately, though each side has accused the other in recent days of violating the terms of their agreement, demonstrating the fragility of their detente. The Mag Seven's communications companies, Alphabet and Meta, likely have the most recession-proof ad businesses on the internet thanks to the sheer size of their audiences. Yet the tech giants face another risk, according to BofA analysts: Tech companies, they say, addressed elevated interest rates in 2023 by effectively 'shortening duration'—they cut costs, reduced capital expenditures, and increased their cash returns. Today, Alphabet and Meta are locked in an all-out AI arms race, spending tens of billions of dollars a year on AI infrastructure. That spending could tie the companies' hands in the event of a slowdown. Another risk for tech stocks is their price tag, according to BofA. Valuations have declined from their recent highs, but the stocks are still expensive—the Mag Seven's P/E ratio of 33.1 is well above the S&P 500's long-term average—and earnings expectations remain elevated. Read the original article on Investopedia Sign in to access your portfolio
CNBC
5 days ago
- Business
- CNBC
There's a 'weird dichotomy' between the Magnificent Seven and the rest of the market
Stocks appear to have come full circle since the start of the year, but with one key difference: the "Magnificent Seven" stocks are not as expensive as they were coming into 2025. The S & P 500 is virtually unchanged on the year, following an extraordinary selloff and recovery over the past two months. In that time, the index slumped 20% from its February peak following the April 2 tariff announcement, then made back all those losses. The broader index is now a little more than 3% off its record high. For all off of 2025, the broad market index has eked out a 0.8% gain, not including reinvested dividends. .SPX YTD mountain S & P 500 in 2025 This time, however, there's a different nuance in the market, according to Marta Norton, chief investment strategist at Empower Investments. She pointed out that while the overall market is more expensive than it was at the start of the year, the Magnificent Seven stocks are cheaper than they were. "At the start of the year, the Mag Seven were very expensive, and you felt like that was going to lead the market down. But at this point in the year, Mag Seven is, you know, certainly rallied back a bit, but it's cheaper than it looked at the start of the year, and it's the rest of the market around the Mag Seven that looks expensive," said Norton. "So, there's this weird dichotomy where the area of greatest risk doesn't look to be quite as big a risk, at least from a valuation standpoint, that it had [at] the start of the year," Norton added. Take Nvidia , which started 2025 with a forward P/E of 31.3, is now trading at 29.6 forward earnings, according to FactSet data. Apple , which was at 33.0, now sells for 26.6 times the coming year's profits. Google-parent Alphabet , which was trading at 21.1, is now at 17.7. Amazon , previously at 35.2, now changes hads at 31.3. Only two of the megacaps stocks trade above their Dec. 31 forward valuations. Meta Platforms , which was at 23.0, is now at 24.3. Microsoft , once at 29.9, is now 30.6. Meanwhile, the broader market looks more expensive. The S & P 500, at 21.3 currently, is trading about where it was in December. But consumer staples companies were at 18.6 times at the end of last year, and are now at 19.9. The cheaper Mag Seven valuations suggest there could be some momentum left in the market even after its huge upswing since early April, since the elite group combined accounts for roughly 30% of the S & P 500 market value. Norton, however, is skeptical the market will rally meaningfully higher in 2025. She thinks the S & P 500 will be rangebound for the rest of the year as expensive valuations in the rest of the market, as well as the impact of tariffs on corporate earnings, will offset any benefits from deregulation later this year. "Should we see the Mag Seven continue to recover, that would certainly be a force for strength in the market, but we still have to watch that remaining 70%," Norton said. Other Wall Street firms are sounding similar concerns. In fact, a note from UBS said that "MAG-7 dominance risk has yet again returned" following Nvidia's latest earnings beat, a development that suggests the market is "now priced for perfection and is vulnerable to even slightly disappointing news."
Yahoo
07-05-2025
- Business
- Yahoo
Is Sea Limited (SE) One of the Best Performing Large Cap Stocks So Far in 2025?
We recently published a list of 11 Best Performing Large Cap Stocks So Far in 2025. In this article, we are going to take a look at where Sea Limited (NYSE:SE) stands against other best performing large cap stocks so far in 2025. The stock market had a chaotic start to the first quarter of 2025. The uncertain tariff policy, growing fears of a recession, and inflation sent the stock market to the worst quarterly performance since the 2022 bear market. On March 31, ClearBridge Investment released its commentary on the market performance. Portfolio Managers Erica Furfaro and Margaret Vitrano highlighted that the S&P 500 index declined 4.27%, whereas the growth-heavy NASDAQ and Russell 1000 Growth Index fell 10.42% and 9.97%, respectively. Elaborating more on the quarterly market performance, the portfolio managers noted that the Russell Growth Index underperformed the Russell Value Index by more than 1,200 basis points indicating that while large-cap stocks were impacted, the growth sector took the major hit. Tariffs were only one of the headwinds affecting the performance and the overall backdrop also includes the launch of Chinese LLM DeepSeek which questioned the AI capital expenditure of various large and mega-cap stocks. This capital expenditure bubble infected the performance of other 'Magnificent Seven' to an extent that only one of the 'Mag Seven' companies could outperform the Russell 1000 Index. Erica Furfaro and Margaret Vitrano noted that their Large Cap Growth ESG strategy performed better than the benchmark amidst all the uncertainty. Their strategy takes the Russell Growth Index as a benchmark. The managers noted that the strategy revolved around being underweight for the Mag Seven and the IT sector. They also highlighted that balancing the portfolio with strong stocks across IT, communication, and financial services also played a pivotal role in generating more relative returns. The investment fund also noted moving towards a 'moving to the middle' approach, which refers to adjusting their portfolio to be less concentrated in any single sector and more balanced across different types of growth companies. Clearbridge has reduced its overweight position in healthcare and increased exposure to the IT sector, which was previously underweight. The fund believes this recalibration positions the portfolio for an economic slowdown. Lastly, Erica Furfaro and Margaret Vitrano noted that the first quarter witnessed the earnings growth broaden away from the Mag Seven and other large-cap stocks outside the big tech names delivered better earnings. They anticipate that, unless there is a recession, earnings growth from industrial and healthcare companies will begin to catch up with the technology sector in 2025.
Yahoo
05-05-2025
- Business
- Yahoo
CVS Health Corporation (CVS): Among the Best Performing Large Cap Stocks So Far in 2025
We recently published a list of . In this article, we are going to take a look at where CVS Health Corporation (NYSE:CVS) stands against other best performing large cap stocks so far in 2025. The stock market had a chaotic start to the first quarter of 2025. The uncertain tariff policy, growing fears of a recession, and inflation sent the stock market to the worst quarterly performance since the 2022 bear market. On March 31, ClearBridge Investment released its commentary on the market performance. Portfolio Managers Erica Furfaro and Margaret Vitrano highlighted that the S&P 500 index declined 4.27%, whereas the growth-heavy NASDAQ and Russell 1000 Growth Index fell 10.42% and 9.97%, respectively. Elaborating more on the quarterly market performance, the portfolio managers noted that the Russell Growth Index underperformed the Russell Value Index by more than 1,200 basis points indicating that while large-cap stocks were impacted, the growth sector took the major hit. Tariffs were only one of the headwinds affecting the performance and the overall backdrop also includes the launch of Chinese LLM DeepSeek which questioned the AI capital expenditure of various large and mega-cap stocks. This capital expenditure bubble infected the performance of other 'Magnificent Seven' to an extent that only one of the 'Mag Seven' companies could outperform the Russell 1000 Index. Erica Furfaro and Margaret Vitrano noted that their Large Cap Growth ESG strategy performed better than the benchmark amidst all the uncertainty. Their strategy takes the Russell Growth Index as a benchmark. The managers noted that the strategy revolved around being underweight for the Mag Seven and the IT sector. They also highlighted that balancing the portfolio with strong stocks across IT, communication, and financial services also played a pivotal role in generating more relative returns. The investment fund also noted moving towards a 'moving to the middle' approach, which refers to adjusting their portfolio to be less concentrated in any single sector and more balanced across different types of growth companies. Clearbridge has reduced its overweight position in healthcare and increased exposure to the IT sector, which was previously underweight. The fund believes this recalibration positions the portfolio for an economic slowdown. Lastly, Erica Furfaro and Margaret Vitrano noted that the first quarter witnessed the earnings growth broaden away from the Mag Seven and other large-cap stocks outside the big tech names delivered better earnings. They anticipate that, unless there is a recession, earnings growth from industrial and healthcare companies will begin to catch up with the technology sector in 2025. To curate the list of 11 best-performing large-cap stocks so far in 2025, we used the Finviz stock screener and Yahoo Finance. Using the screener we aggregate a list of large-cap stocks that have performed well on a year-to-date. Next, we cross-checked the performance from Yahoo Finance and ranked the stocks in ascending order of their year-to-date performance. We have also added the market capitalization of each stock and the hedge fund sentiment as well, as of Q4 2024. Please note that the data was recorded on May 2, 2025. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (). A row of shelves in a retail pharmacy, demonstrating the variety of drugs and over-the-counter Health Corporation (NYSE:CVS) is a leading health solutions company based in the United States. It operates through several segments including the Health Care Benefits, Health Services, and Pharmacy & Consumer Wellness. It serves over 37 million people with health insurance products and operates more than 1,000 walk-in and primary care clinics. The company recently released its first-quarter results for 2025 and its full-year guidance. CVS Health Corporation (NYSE:CVS) posted a revenue of $94.6 billion, reflecting a 7% increase year-over-year. Moreover, the operating income also grew significantly to reach $4.6 billion. The growth was driven by Health Care Benefits which grew 8% year-over-year, with medical membership stable at approximately 27.1 million. Notably, management has announced plans to exit the individual exchange business and focus on other growth areas and also introduced new solutions to improve patient care. Looking ahead, management has raised EPS guidance for 2025 to a range of $6.00 to $6.20 from $5.75 to $6.00. Patient Capital Opportunity Equity Strategy also noted CVS Health Corporation (NYSE:CVS) in its Q1 2025 investor letter. Here's what the fund said about the company: Patient Capital Opportunity Equity Strategy stated the following regarding CVS Health Corporation (NYSE:CVS) in its : 'CVS Health Corporation (NYSE:CVS) went from a top detractor in the fourth quarter to the top contributor in the first quarter. The company faced significant pressure last year from disappointing Medicare Advantage results—an industry-wide challenge. We felt the issues were well understood and expected improvements in pricing for 2026. We took the opportunity to add to the position. Since then, CMS (Center for Medicare & Medicaid Services) has announced 2026 rates at the high end of expectations, supporting a significant earnings power recovery. On a longer-term basis, we continue to think CVS has an attractive combination of assets owning a healthcare benefits business (Aetna), a pharmacy-benefits manager (Caremark), an in-home evaluation business (Signify Health) and in-home primary care business (Oak Street Health) supporting the industry transition to a value-based care model. With new leadership in place, a 4% dividend yield and trough earnings behind us, we see continued attractive prospects ahead. Overall, CVS ranks 3rd on our list of best performing large cap stocks so far in 2025. While we acknowledge the potential of CVS to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than CVS but that trades at less than 5 times its earnings, check out our report about this . READ NEXT: and . Disclosure: None. This article is originally published at . Sign in to access your portfolio
Yahoo
05-05-2025
- Business
- Yahoo
Is Deutsche Bank (DB) The Best Performing Large Cap Stock So Far in 2025?
We recently published a list of . In this article, we are going to take a look at where Deutsche Bank Aktiengesellschaft (NYSE:DB) stands against other best performing large cap stocks so far in 2025. The stock market had a chaotic start to the first quarter of 2025. The uncertain tariff policy, growing fears of a recession, and inflation sent the stock market to the worst quarterly performance since the 2022 bear market. On March 31, ClearBridge Investment released its commentary on the market performance. Portfolio Managers Erica Furfaro and Margaret Vitrano highlighted that the S&P 500 index declined 4.27%, whereas the growth-heavy NASDAQ and Russell 1000 Growth Index fell 10.42% and 9.97%, respectively. Elaborating more on the quarterly market performance, the portfolio managers noted that the Russell Growth Index underperformed the Russell Value Index by more than 1,200 basis points indicating that while large-cap stocks were impacted, the growth sector took the major hit. Tariffs were only one of the headwinds affecting the performance and the overall backdrop also includes the launch of Chinese LLM DeepSeek which questioned the AI capital expenditure of various large and mega-cap stocks. This capital expenditure bubble infected the performance of other 'Magnificent Seven' to an extent that only one of the 'Mag Seven' companies could outperform the Russell 1000 Index. Erica Furfaro and Margaret Vitrano noted that their Large Cap Growth ESG strategy performed better than the benchmark amidst all the uncertainty. Their strategy takes the Russell Growth Index as a benchmark. The managers noted that the strategy revolved around being underweight for the Mag Seven and the IT sector. They also highlighted that balancing the portfolio with strong stocks across IT, communication, and financial services also played a pivotal role in generating more relative returns. The investment fund also noted moving towards a 'moving to the middle' approach, which refers to adjusting their portfolio to be less concentrated in any single sector and more balanced across different types of growth companies. Clearbridge has reduced its overweight position in healthcare and increased exposure to the IT sector, which was previously underweight. The fund believes this recalibration positions the portfolio for an economic slowdown. Lastly, Erica Furfaro and Margaret Vitrano noted that the first quarter witnessed the earnings growth broaden away from the Mag Seven and other large-cap stocks outside the big tech names delivered better earnings. They anticipate that, unless there is a recession, earnings growth from industrial and healthcare companies will begin to catch up with the technology sector in 2025. To curate the list of 11 best-performing large-cap stocks so far in 2025, we used the Finviz stock screener and Yahoo Finance. Using the screener we aggregate a list of large-cap stocks that have performed well on a year-to-date. Next, we cross-checked the performance from Yahoo Finance and ranked the stocks in ascending order of their year-to-date performance. We have also added the market capitalization of each stock and the hedge fund sentiment as well, as of Q4 2024. Please note that the data was recorded on May 2, 2025. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (). A business owner tallying their profits in the back office of a local banking Bank Aktiengesellschaft (NYSE:DB) is an international financial services company based in Germany. The company operates a bank and a holding company for other operations. Its core business activities are administered through various segments including the Corporate Bank, Investment Bank, Private Bank, and Asset Management. The company released its fiscal first quarter results for 2025 on April 29. Management noted that the bank is optimizing its resource allocation and transforming its operating model to reduce branches and improve digitalization. Deutsche Bank Aktiengesellschaft (NYSE:DB) generated €8.5 billion in revenue during the quarter, reflecting a 10% increase year-over-year. Notably, the profitability indicated by pretax profits grew 39% to reach €2.8 billion. Management noted that the revenue growth was broad-based with 71% growth coming from Corporate Bank, Private Bank, Asset Management, and Fixed Income & Currencies Financing divisions. On May 1, Citi raised the firm's price target on the stock from Euro 20.80 to EUR 22.30, while keeping a Neutral rating. It is one of the best-performing large-cap stocks so far in 2025. Overall, DB ranks 2nd on our list of best performing large cap stocks so far in 2025. While we acknowledge the potential of DB to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than DB but that trades at less than 5 times its earnings, check out our report about this . READ NEXT: and . Disclosure: None. This article is originally published at . Sign in to access your portfolio
