The 'Magnificent 7' Stocks Lose Their Shine—Only Amazon Stands Out
Mag 7 Stocks Fall Far Behind the "Other 493"
The "Magnificent 7" once accounted for the majority of U.S. stock market performance, delivering outsized returns from 2023 through Q3 2025. Collectively making up nearly one-third of the S&P 500's market capitalization, their performance largely influenced the broad market's rise in the preceding three years. However, market leadership has begun to shift. As valuations pushed higher and growth expectations were increasingly scrutinized, the group's performance has weakened, turning yesterday's market leaders into today's laggards. The "Lag 7" is a more fitting moniker. Meanwhile, the "Other 493" stocks have quietly outperformed, producing broad gains over the past six months, lifting the equal-weighted index, while the Lag 7 has pulled down the S&P 500.
This shift in market leadership raises an important question: Are these mega-cap giants still worth owning?
How I Used the Quant System to Review the Mag 7 Stocks
If you're not familiar with how the Quant Ratings and Factor Grades work, the system grades each stock by five "factors," which are Value, Growth, Profitability, Momentum, and EPS Revisions. To do this, we compare the relevant metrics for the factor in question for the stock to the same metrics for the other stocks in its sector. The factor is then assigned a grade, from A+ to F. To maximize the predictive value of the Quant Rating, some factors are weighted higher than others. In my review of the Mag 7 stocks, I analyzed each company's Factor Grades to explain each of their respective Quant Ratings.
- Amazon.com Inc. (AMZN)
- Market Capitalization: $2.31T
- Quant Rating: Strong Buy
- Quant Sector Ranking (as of 03/18/2026): 16 out of 479
- Quant Industry Ranking (as of 03/18/2026): 2 out of 26
- Sector: Consumer Discretionary
- Industry: Broadline Retail
Amazon stands out as the only Quant "Strong Buy" among the Mag 7, supported by its 'A-' Growth and 'A+' Profitability Factor Grades. More specifically, its AWS (Amazon Web Services) continues to benefit from accelerating AI-driven demand, while profit margins are growing from improvements in logistics and increases in premium video subscription services.
- Nvidia Corporation (NVDA)
- Market Capitalization: $4.42T
- Quant Rating: Hold
- Quant Sector Ranking (as of 03/18/2026): 91 out of 526
- Quant Industry Ranking (as of 03/18/2026): 23 out of 69
- Sector: Information Technology
- Industry: Semiconductors
Nvidia remains a semiconductor leader, delivering outstanding revenue growth driven by data center demand. Despite its exceptional EPS revisions and "outstanding quarter," its Quant Rating is held back by a high valuation.
- Alphabet Inc. (GOOG, GOOGL)
- Market Capitalization: $3.75T
- Quant Rating: Hold
- Quant Sector Ranking (as of 03/18/2026): 32 out of 223
- Quant Industry Ranking (as of 03/18/2026): 4 out of 58
- Sector: Communication Services
- Industry: Interactive Media and Services
Previously a holding in the Alpha Picks portfolio, Alphabet continues to deliver solid growth through its core advertising business and growing cloud services. However, its Quant "Hold" rating reflects a profitable, growing company whose stock price is muted by a stretched valuation and mixed earnings revisions.
- Microsoft Corporation (MSFT)
- Market Capitalization: $2.97T
- Quant Rating: Hold
- Quant Sector Ranking (as of 03/18/2026): 93 out of 526
- Quant Industry Ranking (as of 03/18/2026): 4 out of 44
- Sector: Information Technology
- Industry: Systems Software
Tech behemoth Microsoft recently topped its historical peak in short interest at 0.9%. Now showing a short interest of 1%, Microsoft's integration of AI across Azure and its Copilot companion, as well as its OpenAI partnership and massive scale in software (Microsoft 365) may prove to be long-term strengths.
- Apple Inc. (AAPL)
- Market Capitalization: $3.73T
- Quant Rating: Hold
- Quant Sector Ranking (as of 03/18/2026): 95 out of 526
- Quant Industry Ranking (as of 03/18/2026): 8 out of 26
- Sector: Information Technology
- Industry: Technology Hardware, Storage and Peripherals
Apple's strength lies in its ecosystem of hardware, software, devices, and services, which combine for outstanding cash flow generation and profitability. However, the company's growth has slowed relative to sector peers, and its premium valuation remains a heavy weight on performance.
- Meta Platforms, Inc. (META)
- Market Capitalization: $1.58T
- Quant Rating: Hold
- Quant Sector Ranking (as of 03/18/2026): 48 out of 223
- Quant Industry Ranking (as of 03/18/2026): 2 out of 5
- Sector: Communication Services
- Industry: Interactive Media and Services
Another former Alpha Picks stock is Meta Platforms. Meta has executed well on cost-cutting measures, such as cutting its workforce by up to 20%, but these moves highlight the company's mounting AI costs.
- Tesla Inc. (TSLA)
- Market Capitalization: $1.50T
- Quant Rating: Hold
- Quant Sector Ranking (as of 03/18/2026): 136 out of 479
- Quant Industry Ranking (as of 03/18/2026): 12 out of 29
- Sector: Consumer Discretionary
- Industry: Automobile Manufacturing
Robotics technology has become a popular theme for 2026. However, Tesla faces growing competition in the EV market amid slowing demand growth. While it maintains a strong demand and long-term innovation potential, its extreme valuation is a high hurdle to overcome in a market where investor sentiment is cooling and consumer discretionary spending is increasingly uncertain.
Conclusion: Will the Mag 7 Return to Magnificence?
The "Mag 7" have lately looked more like the "Lag 7," and the Quant System ratings help to explain the market's broader rotation toward diversification and growth-at-a-reasonable price preferences. While these seven companies remain leaders in their respective industries, the elevated valuations and moderating growth metrics reduce relative appeal below their peak years, from early 2023 to late 2025.
