This “Magnificent Seven” Stock Is Historically Cheap and Begging to Be Bought (Hint: It’s Not Nvidia) | The Motley Fool

Wall Street’s “Magnificent Seven” have played a pivotal role in sending all three major stock indexes to new heights. These are the stock market’s most influential companies, and they possess a healthy combination of sustainable moats and/or competitive advantages.

But not all members of the Magnificent Seven are created equally — and their valuations prove it. While the face of the artificial intelligence (AI) revolution, Nvidia (NVDA 0.33%), is trading at one of its lowest forward price-to-earnings (P/E) ratios in some time, it may not be the bargain you think it is. Meanwhile, dual-industry leader Amazon (AMZN 1.38%) has never been cheaper, according to one key operating metric.

Wall Street’s AI goliath may not be as cheap as it appears

On the one hand, Nvidia has been utterly dominant in the AI arena. Its graphics processing units (GPUs) hold a virtual monopoly in enterprise data centers, with its hardware maintaining clear compute advantages over rivals. Ongoing GPU scarcity and its superior compute have enabled Nvidia to charge a hefty premium for its AI hardware.

With Nvidia consistently crushing Wall Street’s consensus sales and profit expectations, its shares can be purchased for just 16 times forward-year earnings.

Today’s Change

(-0.33%) $-0.57

Current Price

$175.07

Key Data Points

Market Cap

$4.3T

Day’s Range

$173.99 – $176.21

52wk Range

$86.62 – $212.19

Volume

4.4M

Avg Vol

176M

Gross Margin

71.07%

Dividend Yield

0.02%

However, history suggests…