Forget The Magnificent Seven. Focus On These Fab Five.

The Magnificent Seven stocks — S&P 500 giants (AMZN), Apple (AAPL), Google parent Alphabet (GOOGL), Meta Platforms (META), Microsoft (MSFT), Nvidia (NVDA) and Tesla (TSLA) — have been grouped together since the start of the bull market in January 2023.


But since mid-2023, and certainly in 2024, there is a clear distinction between these seven megacaps. By both timeframes, the Fab Five of Nvidia, Meta Platforms, Google, Microsoft and Amazon stock are all up, outpacing the S&P 500 and the Nasdaq composite. Apple stock is flat in both instances. Tesla stock is a huge laggard over these time frames.

Magnificent Seven Stock Performance

Company Ticker Stock chg since June 30 2024 chg
Nvidia NVDA 44.27% 23.24%
Meta Platforms META 37.34% 11.35%
Google GOOGL 27.14% 8.94%
Amazon AMZN 22.06% 4.73%
Microsoft MSFT 18.61% 7.42%
Apple AAPL -0.80% -0.06%
Tesla TSLA -30% -26.25%
S&P 500 9.90% 2.54%
Nasdaq 12.09% 2.96%

S&P 500 Megacap Earnings

The fundamentals also show a separation between the Fab Five and their not-so-magnificent peers. Meta Platforms and especially Nvidia are seeing skyrocketing growth. Amazon earnings are roaring back while Google and Microsoft are delivering solid double-digit growth.

Apple earnings are up modestly, but sales have fallen vs. a year earlier for four straight quarters. Tesla earnings are plunging with few growth drivers through 2025.

Finally, Nvidia and Microsoft are leaders in artificial intelligence, the transformational theme driving the market rally. Meta, Google and Amazon are significant players as well. Amazon, Microsoft, Google also are cloud-computing giants, with Nvidia powering much of those efforts too.

Of course, these S&P 500 titans could look different in a few days on technicals and fundamentals. Microsoft, Google, Amazon, Meta Platforms and Apple all report this coming week.

Meta stock and Nvidia are on IBD Leaderboard. Microsoft and Nvidia stock are on SwingTrader. MSFT stock is on IBD Long-Term Leaders. Google stock, Nvidia, Meta and Microsoft are all on the IBD 50. Meta, Google and Nvidia are on the IBD Big Cap 20.

Nvidia Stock

Nvidia stock has run 23.2% in 2024 and 44.3% since June 30. The S&P 500 index’s best performer in 2023, NVDA stock is No. 1 in the new year aside from Juniper Networks (JNPR), which is being acquired.

The AI chip leader spend most of the second half of 2023 moving sideways.

NVDA stock finally cleared its range on Jan. 8, with a powerful breakout.

Nvidia and rival Advanced Micro Devices (AMD) announce new AI chips that day.

That fueled a big rally in chips and the broader market, shrugging off a rough start to 2024.

Nvidia earnings are exploding amid voracious demand for its high-powered chips for AI. Earnings per share skyrocketed 429% and 593% in the past two quarters, with revenue up 101% and 206%.

Nvidia won’t report fiscal Q4 results until late February. AMD does report on Tuesday. Also, earnings call comments from Microsoft, Meta, Google and Amazon this week will offer insight into Nvidia chip demand.

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Meta Stock

Meta stock has rallied 11.35% in 2024, part of a 37.3% sprint from June 30.

Shares moved sideways from late July to mid-December, though its relative strength line held up or even advanced. Since mid-December, shares have

Meta earnings have ramped up from -52% to -3% to +31% and +168% in the past few quarters. Some of that reflect cost curbs from job cuts and reining in metaverse ambitions somewhat. But it also reflects revived online advertising. Revenue growth has improved from -4% to +23% over the same span.

Meta reports fourth-quarter earnings late Thursday.

Google Stock

Google stock has gained 8.9% in 2024, with a 27.1% jump since mid-2023.

Google earnings and revenue growth also have accelerated for the past three quarters. EPS growth has gone from -19% to +42%, while revenue gains have stepped up from 1% to 11%.

Google releases Q4 results late Tuesday.

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Amazon Stock

Amazon stock has advanced 4.7% this year but 22.1% since mid-2023. Shares decisively cleared a consolidation in mid-December and are now extended from that. AMZN stock arguably is still in range of a 10-week line bounce, though Thursday’s earnings report would greatly add to the risk.

Amazon earnings have improved dramatically on a quarter-to-quarter basis, from 3 cents in Q4 2022 to 31 cents in Q1 2023, 65 cents in Q2 and 94 cents in Q3, with the latter up 236% vs. a year earlier. Revenue growth has picked up for the past two quarters, to 13% in Q3.

S&P 500 Stock: Microsoft

Microsoft stock has rallied 7.4% in 2024 and 18.6% since June 30.

The Dow Jones giant paused from mid-July to late October, but then ran up following fiscal Q1 earnings. MSFT stock then paused for two months in the buy zone, before rebounding from the 50-day line a few days into 2024. It’s now just out of buy range.

Microsoft stock now boasts a $3.002 trillion market cap, slightly exceeding Apple’s valuation of $2.992 trillion.

Microsoft earnings and sales growth have modestly accelerated for the past three quarters. EPS has gone from -6% to +27%, while sales gains ramped up from 2% to 13%.

Microsoft releases fiscal Q2 results Tuesday evening.

Apple Stock

Apple stock is down less than 0.1% so far in 2024 and off 0.8% since mid-2023. Shares fell significantly to start 2024 amid a flurry of analyst downgrades. Some of that reflected growing concerns about Apple iPhone demand in China. But an upgrade on its upcoming Vision Pro mixed-reality headset and quiet AI efforts helped trigger a bounce back above the 200-day and 50-day lines, offering an aggressive entry within a new flat base. Investors could use the Jan. 24 high of 196.38 as a new early entry.

Apple earnings growth has accelerated for the last three quarters, from -10% to 0%, to +5% and +13%. But sales growth has fallen slightly for four straight quarters.

Apple earnings for fiscal Q1 are due Thursday night.

These Five Stocks Are Near Buy Points

Tesla Stock

Tesla stock has plunged 26.25% so far in 2024 and 30% since mid-2023, skidding to their worst levels since last May. The RS line is at a one-year low.

TSLA stock is the second-worst performer on the S&P 500 in 2024, behind only Archer Daniels Midland (ADM), which has crashed on accounting woes. But it’s worse than Boeing (BA), which is reeling from 737 Max 9 woes, as well as Humana (HUM), which has issued two massive profit warnings already this year.

Shares hit a 52-week high of 299.29 on July 19, just before Q2 earnings. Tesla has sold off hard after the last four earnings reports.

Last week, Tesla reported a 40% dive in Q4 earnings vs. a year earlier while sales grew just 3.5%, both slightly missing views. Worse, the EV giant forecast “notably lower” delivery growth in 2024 but few specifics on volumes and profit margins. A next-generation EV could start production in late 2025, but Elon Musk said that might be “optimistic.” As for moonshots, Musk said in-house Dojo chips are a “long shot,” saying that Tesla will keep buying Nvidia chips for its AI efforts.

Despite its recent tumble Tesla stock has a forward price-to-earnings ratio of 57, by far the highest in the Magnificent Seven.

New Magnificent Seven?

Alternatively, a new Magnificent Seven could be forged with Taiwan Semiconductor Manufacturing (TSM) and Eli Lilly (LLY) joining the Fab 5.

Taiwan Semi, which makes chips for Nvidia, Apple and many others, is at the cutting edge of chipmaking technology. And it’s a market mover. Its bullish 2024 revenue forecast sent chipmakers and chip-gear makers soaring.

S&P 500 giant Eli Lilly, along with Denmark’s Novo Nordisk (NVO), is a weight-loss drug leader. Along with artificial intelligence, weight-loss drugs have the potential to transform society and many industries.

Both TSM stock and Eli Lilly are up solidly to start 2024, 12.75% and 9.7%, respectively. Both are strong since mid-2023, with Taiwan Semi up 16.2% and LLY stock 36.3%.

Eli Lilly is in a buy zone.

Both have higher market caps than Tesla stock now.

Please follow Ed Carson on Threads at @edcarson1971 and X/Twitter at @IBD_ECarson for stock market updates and more.


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