Apollo should be smart enough to know that you can't draw any conclusions from 1 month of market data (especially when there was a big, relevant IPO).
Actually it's almost 2 months /s
Mag 7 starting to underperform [pdf]
41–50 of 169 posts
Re: Mag 7 starting to underperform [pdf]
#42Earlier quoted context omitted.
I mean these stocks have been performers for decades. If you posted this 10 years ago you'd look really wrong.
Yes, but when their run ends they tend to underperform. Every time.
If a stock market observation has no predictive power, then it's worthless.
I look forward to your weather report too: "It's always sunny outside until one day it starts raining. Every time."
Re: Mag 7 starting to underperform [pdf]
#43Apollo should be smart enough to know that you can't draw any conclusions from 1 month of market data (especially when there was a big, relevant IPO).
Right, but they're smart enough to know how to manipulate the market short term with such "research" and then take advantage of it, all without breaking the law.
Re: Mag 7 starting to underperform [pdf]
#44Re: Mag 7 starting to underperform [pdf]
#45Markets are obviously, rationally, not happy about the overspending.
But what gives me pause is that a some of the mag 7 (think Meta) could change their mind on AI build-out tomorrow, and 1-year from now have the same amazing free cash flow they always did.
Re: Mag 7 starting to underperform [pdf]
#46I guess "nothing lasts forever".
Of course. The rest 'n vest people at FAANG companies will tell you its lasts forever 6 years ago. Now they are scared for their jobs. This is why we are seeing a correction at those companies, perks and free food going away with constant layoffs and all time low morale. Now the party is at Nvidia. But I will tell you that that will not last forever either.
Everything reverts to the mean in the long term.
Maybe even the state of unprecedented relative peace we had enjoyed.
Re: Mag 7 starting to underperform [pdf]
#47I am invested in some of the companies that are downstream of the capital expenditures of Big Tech (e.g., COHR), so I have nothing to complain about. I am really struggling to see what's the investment thesis behind Google valuation increasing 2x in response to AI, though. Assuming no magical AGI singularity, by the end of the day, they're still selling the same services, but the services have gotten more expensive f…
The market runs on memes, hype and fraud. Fundamentals haven’t mattered for a long time.
I guess Google’s Q1 earnings of $62 billion were just hype.
Re: Mag 7 starting to underperform [pdf]
#48Earlier quoted context omitted.
If we're doing money=smart, the mag 7 control almost $4T in assets and cash, so wouldn't you trust them even more?
Not based on the evidence of how they allocate capital. Meta wasted $80B on the Metaverse, for example. Apollo allocates capital as their day job. Mag7 allocates by vibes. https://finance.yahoo.com/sectors/technology/articles/mark-z... https://www.nytimes.com/2026/03/19/technology/mark-zuckerber... | https://archive.today/iEGAj
> Apollo allocates capital as their day job. Mag7 allocates by vibes
Lol what in the world? Is running a trillion dollar corporation anything other than allocating capital?
You can argue that Meta made a poor capital allocation decision with VR and perhaps continues to do so with AI.
Re: Mag 7 starting to underperform [pdf]
#49Earlier quoted context omitted.
Apollo Group has $1T assets under management, I believe them over most folks on HN. Their argument that the Mag 7 is burning up all of their free cash flow is factually accurate, as the returns are not materializing for the investments being made (ie underperformance).
The Mag 7 spending around $700B on capex this year, expected around a trillion next year. That's more than their combined FCF, and they're borrowing to bridge the gap.
One is not spending anything out of the ordinary up until this point in comparison to their competition. But the Apple Silicon design group might start spending some money on something practical, something that might begin the typical Apple long-range process of replacing two or three existing companies within their current supply chain, but that’s nothing new over the last 25 years.
Re: Mag 7 starting to underperform [pdf]
#50I am invested in some of the companies that are downstream of the capital expenditures of Big Tech (e.g., COHR), so I have nothing to complain about. I am really struggling to see what's the investment thesis behind Google valuation increasing 2x in response to AI, though. Assuming no magical AGI singularity, by the end of the day, they're still selling the same services, but the services have gotten more expensive f…
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