Looking Beyond The ‘Magnificent 7’ — Analysts Just Upgraded These Three Large-Cap Stocks

The Magnificent Seven stocks have dominated the stock market this year, driving the tech-focused Nasdaq Composite Index’s over 43% year-to-date gains.

The large-cap tech stocks mainly banked on the booming artificial intelligence (AI) sector and the growing popularity of the metaverse. AI chipmaker Nvidia Corp. (NASDAQ:NVDA) has been the best-performing Magnificent Seven stock this year, gaining over 234% year to date. Meta Platforms Inc. (NASDAQ:META) is close behind with over 193% gains over the same period.

With immense upside over the past year, many experts speculate the tech behemoths have peaked. With recession fears looming for 2024, diversifying outside of big tech can hedge investors’ portfolios in the event of a market downturn.

Don’t Miss:

As of Dec. 4, the recession probability model from the New York Federal Reserve indicates a 51.8% likelihood of a U.S. recession occurring within the next 12 months.

Irrespective of the concerning market backdrop, analysts are bullish on these large-cap stocks in the near term.

Spotify

Up over 140% year-to-date, Spotify Technology (NYSE:SPOT) is one of the biggest music streaming companies in the world.

Spotify enjoys strong financials, as its total monthly active users increased 26% year over year to 574 million in the fiscal third quarter ended Sept. 30. The company’s revenue increased 11% year over year to €3.36 billion ($3.7 billion). Operating income came in at €32 million, compared to a loss of €228 million reported in the same quarter last year.

The company slashed its workforce by 17% earlier this month, which is expected to reduce its operating expenses by roughly 2% in fiscal 2024.

Story continues

“Over the last two years, we’ve put significant emphasis on building Spotify into a truly great and sustainable business — one designed to achieve our goal of being the world’s leading audio company and one that will consistently drive profitability and growth into the future,” Spotify CEO Daniel Ek said. “While…