Remember when everyone was screaming about an AI bubble? Yeah, well, the Mag 7 stocks just got a reality check, and honestly, it might be the best thing that could’ve happened to your portfolio.
Here’s the deal: Nvidia, Amazon, Microsoft, Meta, Alphabet, Apple, and Tesla have all taken a beating—down roughly 19% since October. But here’s where it gets interesting. According to Marta Norton, chief investment strategist at Empower Investments, these mega-cap darlings are now trading at valuations we haven’t seen since 2015. Translation? You’re basically paying the same price for these titans as you would for a boring old S&P 500 index fund.
That’s wild. And it’s probably not going to last.
Norton specifically loves the five AI-focused names in the group: Nvidia, Amazon, Microsoft, Alphabet, and Meta. Why? Because four of them—everyone except Nvidia—are “hyperscalers,” which is a fancy way of saying they’re building the AI infrastructure *and* trying to make money off it. They’re playing both sides of the game. Nvidia’s the supplier; the others are the builders and the monetizers.
The catch? These companies are spending like crazy. We’re talking about $600 billion combined in capital expenditures in 2026 alone. That’s a lot of chips, data centers, and electricity bills. The risk is real: if they can’t turn all that spending into actual profits down the line, investors could get burned.
But here’s Norton’s take, and it’s worth listening to: cheaper valuations mean less risk. When you’re buying at a discount, you’ve got more margin for error. And if these companies *do* figure out how to monetize their AI investments—which, let’s be honest, they probably will—you’re going to wish you’d loaded up at these prices.
“If I were to fall asleep for 10 years, these are the names I would want to have in my portfolio,” Norton said. That’s not casual talk from a professional investor. That’s conviction.
The real question isn’t whether AI is a bubble—it’s whether these companies can justify their spending. And given their track records, the smart money says they will. They’ve got the cash flow, the talent, and the market position to make it work.
So what’s the play? If you’re thinking long-term and can stomach some near-term volatility, the Mag 7 at these prices looks like a genuine opportunity. Not a “get rich quick” scheme, but a solid bet on the companies that are actually building the future.
Just don’t expect it to be smooth sailing. Norton herself said there could be more downside in the near term. But if you’re the type who can ignore the noise and think in decades instead of quarters, the Magnificent Seven might just be magnificent again.
