On February 6th, five of the seven giants have announced their performance so far, with Amazon scheduled to announce on Thursday and Nvidia expected to announce later this month. The seven giants have boosted the profit growth and stock returns of the S&P 500 index, accounting for about one-third of the benchmark index. Over the past two years, more than half of the increase in the index has come from these companies, but their profit growth is slowing down as expenses increase. From the perspective of forward P/E ratio, the seven giants have an overall premium of 40% over the S&P 500 index, so these concerns pose a threat to their high valuation. This premium level is already narrowing, below the peak of 70% in 2023.
Scan code to share