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Magnificent 7 vs Burry - 2026 AI Reckoning.
@JC888：
When Michael Burry’s bearish bets became public in early November 2025, the "Burry effect" triggered a volatile re-evaluation of the AI trade. While $NVIDIA(NVDA)$ and $Palantir Technologies Inc.(PLTR)$ were his primary targets, the shockwaves moved through the entire Magnificent 7, as investors began questioning if the massive capital expenditures (CapEx), estimated to top $250 billion across the group by year-end, would ever yield a proportional return. As of 19 Dec 2025 EOD As we stand 5 trading days away from 2026, below is how each Magnificent 7 stock, has fared with the group averaging a +32% YTD return, though individual results vary wildly from NVDA’s triple-digit surge to GOOGL’s modest single-digit gain and their outlook for 2026. (see below) Nvidia (NVDA) The Impact: As the primary target of Burry’s $187 million “put” position, NVDA bore the brunt of the November sell-off, dropping -9.1% in just 3days after the news, wiping out nearly $310 billion in market cap almost overnight. Burry’s critique focused on "accounting gluttony" specifically on how hyperscalers are extending the depreciation life of Nvidia chips from 3 to 6 years to hide the true cost of AI infrastructure. As of 19 Dec 2025 EOD 2026 Outlook: Despite the "beating," NVDA remains the world's most valuable company at $3.6 trillion valuation. With projected Q4 2025 revenue of $65 billion, representing a +85% YoY increase, beating even the loftiest analyst estimates. NVDA’s "unscathed" status depends on whether the Blackwell chip transition proceeds without technical hitches in early 2026. This as 75% of top supercomputers are (now) powered by Nvidia tech. $Apple(AAPL)$ The Impact: Apple suffered a 1-day drop alongside the sector in early November but recovered more quickly than the pure-play AI names. Burry’s skepticism about "AI bubbles" did not hit Apple as hard because its revenue is still largely driven by hardware (iPhone) that still accounts for roughly 48% of its total revenue, rather than speculative cloud growth. As of 19 Dec 2025 EOD 2026 Outlook: Apple is well-positioned for 2026. iPhone 17 is already showing strong pre-release momentum, with 1st-month China sales reportedly up +22% YoY. AAPL as a "consumer AI" play rather than an "infrastructure AI" play, is less vulnerable to the depreciation concerns Burry had raised about data centers, especially with an active device base now exceeding 2.35 billion units. $Microsoft(MSFT)$ The Impact: MSFT felt the heat because it is the largest buyer of the chips Burry is shorting. When Burry highlighted that "hyperscalers" are overstating profits by $176 billion through depreciation tricks, MSFT, the leading AI hyperscaler, with Azure AI serving 60,000+ customers, saw its shares dip as investors scrutinized its massive Azure CapEx. 2026 Outlook: Wall Street remains incredibly bullish, with an average price target 29% higher for 2026. As long as Azure growth continues to accelerate, (1) reaching a $75 billion annual run rate in late 2025 and (2) hitting +40% YoY in late 2025, MSFT will likely emerge unscathed by 2026, bolstered by 100 million monthly active Copilot users. Alphabet (GOOG) The Impact: Alphabet’s stock has been a roller coaster. While it fell during the November "Burry dip," it hit fresh all-time highs later that month following the launch of Gemini 3, that now processes 7 billion tokens per minute. However, it faced fresh pressure in mid-December due to EU antitrust fines, including a recent $3.5 billion charge, showing it is more susceptible to regulatory "shocks" than the "Burry shock." As of 19 Dec 2025 EOD 2026 Outlook: Analysts are cautious, with a 12-month price target only +5% above current levels. Alphabet faces a "dual-threat" in 2026 - (1) Burry’s skepticism about AI search profitability and (2) looming shadow of US and EU antitrust rulings, that could impact its record-breaking $102 billion quarterly revenue milestone $Amazon.com(AMZN)$ The Impact: Amazon was the "shield" for the Mag 7 in November. Reporting a massive +36% jump in EPS on 31 Oct 2025, it soared +13% overnight, providing a buffer that prevented the Burry-led sell-off from becoming a total market crash. 2026 Outlook: AMZN is arguably the strongest contender for 2026. With AWS re-accelerating to 20%+ growth, driven by (1) 3.8 gigawatts of new capacity added this year and (2) its own internal AI chip development (the Trainium3, launched on 03 Dec 2025) — mitigating the cost of NVDA's hardware. AMZN is likely to come out of this period totally unaffected. Meta Platforms (META) The Impact: Meta took a significant "beating" in late November, slumping -11% after forecasting "notably larger" CapEx for 2026, upward of $100 billion to $150 billion. This played directly into Burry’s narrative that the AI trade is becoming an "arms race of spending" with no immediate profit ceiling. It also harked back to Meta’ foray into Metaverse that burned $70 billion with nothing to show for, leading to Zuckerberg’s decision to reduce its metaverse-specific budget approx by -35%. As of 19 Dec 2025 EOD 2026 Outlook: Despite the spending, Meta is highly rated by analysts (60 "Buy" ratings). By pivoting toward "Agentic AI" that automates advertising, generating over $60 billion in annualized AI-powered ad revenue, Meta is proving it can turn AI spending into actual cash flow, making it a likely survivor of any 2026 volatility and reaching 3.54 billion daily users. Tesla (TSLA) The Impact: Tesla is the outlier. Burry explicitly called it "ridiculously overvalued" in December, focusing on the potential dilution from Musk’s $1 trillion pay package, that received fresh shareholder approval in November 2025, rather than just AI. TSLA has been highly volatile, often moving more on Trump-era political news and "DOGE" sentiment than on the AI sector fundamentals. On Mon, 15 Dec 2025, the narrative flipped. "Austin Reveal": Musk announced that TSLA has begun testing fully driverless, passenger-free robotaxis on public roads in Austin, Texas, with a pilot fleet of 31 active vehicles. This move proved to the market that "unsupervised FSD" (Full Self-Driving) is no longer a promise but an active pilot. TSLA shares surged as much as +4.9%, hitting $481.37, its highest level in nearly a year defying a generally down day for the Nasdaq. As of 19 Dec 2025 EOD 2026 Outlook: Tesla should enter 2026 with the highest "dispersion" of analyst targets in the Mag 7. Wedbush’s Dan Ives has reiterated a $600 price target, projecting that 2026 will be a "monster year" as the AI and Robotics division (Optimus + Robotaxis) alone achieves a $1 trillion valuation, aiming for 1 million robotaxi units by 2035. Morgan Stanley’s analysts remain cautious, warning of a "choppy” trading environment due to the gap between visionary AI and current contracting auto revenues. Also it is still too early to foretell, to what extent anticipated SpaceX IPO will have a positive rub off effect on TSLA in 2026. Mag 7 2026 "Survival" Summary Do you think this summary accurately reflects Magnificent 7’s current sentiments ? "Safest" exits — AMZN & MSFT (Strong cash flow and AWS/Azure growth approaching 20% & 40% respectively). "Visionary" wildcard — TSLA (Fueled by the 15 Dec driverless reveal and SpaceX IPO hype). "Value" question — AAPL & GOOG (Both facing heavy regulatory / tariff headwinds, despite AAPL's 10% YoY shipment growth). "Efficiency" test — NVDA & META (To prove massive 2025 CapEx translates to 2026 profit). Magnificent 7 - 2026 Summary. As we approach the final 4½ trading days of 2025, the Magnificent 7 are no longer moving in lockstep. The "everything AI" rally of early 2024 has transitioned into a "show me the money" phase for 2026. While Burry’s short positions created a temporary "November chill," underlying health of these giants varies significantly based on their capital efficiency and regulatory exposure. Should I cherry-pick the best of the 7 stocks to invest, stick with NVDA OR are they all winners ? What do you think? Due to creative differences and bias, I will scale back my posting. My 2,430 ‘timeless’ posts remain available (for now) for those who value fundamentals as Mr Buffett had pointed — invest in businesses, not pick stocks. To new subscribers, no flashy screens to entice blind investing. I aim to share on how to fish, not fish for you. I’m grateful to share what I know. In the alternate moo moo universe, where I am valued & appreciated, I will still be sharing. Good luck on your i-journey. Remember to check out my other posts. (See below). Help to Repost ok, Thanks. Must Read: Click on below titles to access. Repost to share, Like as encouragement ok. Thanks. PLTR Almost Return To Its Peak ! Buy ? GSAT : A Must-Own 2026 Growth Stock. Now ! NVDA : Crushed by Burry's Short and More ... ? Do you think there will be a clear winner out of the Mag 7 in 2026 ? Do you think Tesla might be the one or will it be something else - Google ? If you find this post interesting, give it wings! ️ Repost and share the insights ? Do consider “Follow me” and get firsthand read of my daily new post. Thank you. @Daily_Discussion @TigerPM @TigerStars @Tiger_SG @TigerEvents
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