Posted by mooreds 6 hours ago
Amazon $200B
MS $190B
Alphabet $175B-$185B
Meta $115B-135B
If a good enough model can be swapped in every few months, the value moves away from the model and toward cheap inference. That is great for users, but not always great for returns on huge capex.
-signed a bitter somebody that had to buy a new SD card for my camera last week.
One major part of the investment thesis in these companies were their constant stock buy backs. Now their gargantuan Capex that sees no end but acceleration is back at diluting investors.
I think the companies will keep doing fine, but the financial outlooks are no longer as rosy.
Mag7 is just an arbitrary list of companies that were coined at a specific time with no rigor.
If you must do rigorous analysis, then just like S&P 500 you need to add drop BigTech / High Growth companies continuously to this Mag7 (or Mag10) and then do analysis
This is why we are seeing a correction at those companies, perks and free food going away with constant layoffs and all time low morale.
Now the party is at Nvidia. But I will tell you that that will not last forever either.
Maybe even the state of unprecedented relative peace we had enjoyed.