Great Ones,

What if I were Apple (NASDAQ: AAPL) in black jeans?

What if I were Nvidia (NASDAQ: NVDA), it’s no myth?

Wait … Really, Michael Penn?

Right you are, Ken … I mean, Great Ones. And no, we’re not charting Michael Penn’s success today. We’re doing Chart of the Week!

But, Wall Street and the financial media are selling you a myth. A myth about how the technology sector, specifically the AI sector, is massively outperforming the broader market. 

More AI bloat? Seriously?

Yes, more AI bloat. It’s all AI bloat – especially, right now. I mean, you don’t file a $2-trillion IPO in this market without weaving a few tales, or leaving out the names of a few customers … am I right? 

This week, following Anthropic’s $2-trillion IPO announcement, nearly every major financial publication started talking about how The Magnificent 7 has vastly outperformed the S&P 500 Index – aka, the broader market or “The Rest.” 

For reference, The Magnificent 7 is composed of Microsoft (NASDAQ: MSFT), Alphabet (NASDAQ: GOOGL), Amazon (NASDAQ: AMZN), Tesla (NASDAQ: TSLA), Apple (NASDAQ: AAPL), Nvidia (NASDAQ: NVDA), and Meta Platforms (NASDAQ: META).

Here’s a version of the chart being shared around:

​I have to admit, that’s pretty darn impressive. 

But I have trouble accepting things at face value. So I did a little digging to see exactly what was going on. After all, TSLA is down roughly 25% year-to-date (YTD), meaning one or more of the Mag 7 members is doing all the heavy lifting. 

As it turns out, there are only two companies responsible for this incredible out-performance:

In fact, when you strip out the Not-So-Magnificent 5, the chart looks a whole lot different:

​It turns out that the much-vaunted technology and AI sector isn’t anywhere near as robust as we’re being told. 

In fact, it looks like, minus AAPL and NVDA, the AI and tech sector is struggling just as hard as the rest of the market. 

Here’s what the chart looks like with just AAPL and NVDA, sans the Not-So-Magnificent 5:

​Judging from these charts, I’ll bet many of you are thinking:

I’ll just buy AAPL and NVDA, then!

And you wouldn’t be wrong.

Both Apple and Nvidia have handed out massive amounts of cash to shareholders in the form of stock buybacks. In fact, Nvidia just bumped its buyback plan by $150 billion.

Greater Stuff’s official opinion is that if you are going to hold any stocks in the AI sector, it should be Apple and Nvidia.

But, Mr. Great Stuff, you just told us to take profits and trim our NVDA holdings yesterday!!!

I did. But I didn’t tell you to sell all your NVDA holdings. 

It’s true, I am very adverse to market and equity exposure right now. With interest rates rising and corporate debt loads skyrocketing due to AI infrastructure build-out, I’m not sure why y’all aren’t more risk averse … but that’s another discussion.

The goal of every investor is to make money, right? 

That’s the whole point of wading through Wall Street’s insanity, after all.

But in bear markets and corrections, making money isn’t always possible for us plebeian investors and traders. Instead, we have to set up our portfolios to lose less money than the broader market. 

To do this, we find stocks just like AAPL and NVDA. These companies have billions in available cash-on-hand and have proven that they will use that cash to take care of their shareholders. 

Yes, I’ve called it shareholder PR before and disagree with the legality of share buybacks. 

But, if the option is there to protect your family and your capital, save your retirement or your investment nest egg, you do it. At least until you find a better way…

I’m pretty sure y’all can draw your own conclusions as to why the financial media is pushing the Magnificent 7 narrative. 

To me, these headlines arriving right after Anthropic’s ridiculous $2-trillion IPO valuation screams agenda-pushing … a narrative that keeps investors holding stock in companies that are actually massively underperforming. It screams: Please keep buying AI stocks! They are outperforming, you know!

When in actuality, you’d be better off just buying Apple and Nvidia. 

Now that’s a real, “Don’t waste your money.”

Still have questions? 

I know you do: Drop me a line and let me know!

Remember, Greater Stuff doesn’t exist without your help and support!

Like, share, and comment! Help me reach all the OG Great Ones and build this community once again! 

And if you have a stock or investing idea you’d like to see Greater Stuff cover, let us know at: [email protected]. 

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Until next time, stay Great!​

​Joseph Hargett

Editor, Greater Stuff

Founder, Greater Stuff Publishing LLC

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