economy
February 22, 2026
The 'Magnificent Seven' drove the stock market to record highs in recent years. Is the trade over?
Shares of all but two stocks in the "Mag 7" are in the red this year as worries mount about tech giants' soaring AI-fueled capex and earnings growth rate.
TL;DR
- Most of the 'Magnificent Seven' stocks are down in early 2026 after years of record highs.
- High capital expenditures on AI are straining tech giants' free cash flow.
- Earnings growth for Big Tech is slowing, with EPS growth tracking at its slowest pace since early 2023.
- Investors are rotating from high-growth tech names towards undervalued cyclical areas of the market.
- Concerns exist about the ability of these companies to meet high earnings growth expectations amid increased competition and rapid AI model improvements.
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