Gandalf's Guide to Playing the Magnificent 7 Stocks: Unleash the Power of the Wizard!

Gandalf's Wisdom: Earnings Matter But Multiples Drive Stocks

As Gandalf the Grey I have seen many battles and traversed through treacherous mountains. Let me tell you my friends when it comes to investing in the Magnificent 7 stocks don't be fooled by short term earnings. It's the multiples that move mountains! Dan Niles the founder and senior portfolio manager of The Satori Fund agrees with my wisdom. He understands that the longer term earnings will always matter but multiples are what truly drive stocks.

The Rise and Fall of the Magnificent 7

Ah the Magnificent 7 stocks they have been the talk of the town. Apple Tesla and Alphabet have stumbled along their journey while Meta Platforms Amazon Nvidia and Microsoft have soared higher than a Hobbit atop an eagle. Niles believes in the power of actual earnings and fundamentals which is why he's short on Apple and Tesla and long on the others. It seems my magical powers of foresight have rubbed off on him!

Meta Platforms: The Hidden Gem

Meta Platforms formerly known as Facebook has caught Niles' keen eye. The company's price to earnings ratio is as modest as Bilbo Baggins himself and its advertising numbers are as dazzling as a wizard's fireworks. Niles points out that while Apple and Tesla may have lost their way Meta Platforms' December quarter EPS increased by a whopping 90% last year. No wonder the stock has almost tripled!

Nvidia: A Mountain of Success

Nvidia the magical mountain of success has made Niles' heart skip a beat. With a jump of about 48% this year it's hard not to be impressed. While other stocks may have faltered Nvidia's earnings have propelled it to new heights. It's like watching the Fellowship of the Ring on their epic journey going from strength to strength!

The Microsoft Magic

Ah Microsoft the wizard's ally in the world of technology. Niles anticipates that Microsoft will benefit from Copilot and its investment in OpenAI. As Copilot guides the way Microsoft's GAAP earnings per share are expected to double in the coming years. Just like me Microsoft knows how to wield its power wisely!