Wall Street Reassessing Tesla’s Position In "Magnificent 7"

Tesla has some work ahead if it wants to maintain its standing among tech elites.

The Magnificent Seven — Nvidia, Apple, Alphabet, Amazon, Meta, Microsoft, and Tesla — dominated markets in 2023 and are expected to remain key drivers as the third-quarter earnings season unfolds. I Photo:

Despite posting a surprising third-quarter earnings report that sent the EV maker's stock soaring — marking its biggest intraday jump in over a decade — Wall Street is once again reevaluating Tesla's place within the "Magnificent Seven," Seana Smith reported for Yahoo Finance.

The Magnificent Seven — Nvidia, Apple, Alphabet, Amazon, Meta, Microsoft, and Tesla — dominated markets in 2023 and are expected to remain key drivers as the third-quarter earnings season unfolds.

Collectively, they are anticipated to lead with an 18.1% year-over-year earnings growth in Q3. Notably, Nvidia, Alphabet, Amazon, and Meta are projected to be among the top 10 contributors to S&P 500 earnings growth, according to FactSet.

However, concerns surrounding Tesla’s inclusion in the group have resurfaced, despite its earnings resurgence.

Tesla's third-quarter profits soared by 17%, marking a significant recovery after two quarters of declines.

But Wall Street remains cautious. Analysts warn that Tesla may still fall behind the rest of Big Tech due to what some view as overhyped fundamentals. Jay Woods, chief global strategist at Freedom Capital Markets, compared Tesla’s stock to bitcoin, suggesting it trades more on "hopes and dreams" than fundamentals.

“Tesla had its moment in the sun. To me, it’s more like a Cisco or an Intel during the dot-com bubble, and now we’re moving on to other things,” Woods remarked on Yahoo Finance’s Morning Brief.