A rotation out of the Magnificent Seven tech stocks may be afoot. But staying away may be easier said than done for many investors. Take Mag 7 member Amazon . The e-commerce and cloud giant is expected to exceed Wall Street’s profit margin expectations in 2024 due, in part, to contributions from its Prime Video service, according to a note Wednesday from Bank of America. On Jan. 29, subscribers will need to pay an additional $2.99 a month to keep watching without ads. This positive outlook is an example of “how it’s so hard to be able to say, ‘You know what, I’m done with the Magnificent Seven,’” Jim said Wednesday, referring to the group of large-cap tech stocks that soared in 2023. Jim expects many customers will pay a few extra bucks to avoid a few minutes of ads interrupting Prime Video shows such as “Reacher,” a popular scripted action series based on the Lee Child’s book series. “For $2.99, I’m happy to be commercial free, so what’s going to happen is that’s pure margin expansion,” Jim said. After cost cuts in 2023 helped Amazon’s profit margin approach record levels , additional steps forward in the new year will likely catch investor attention. In addition to Amazon, the Magnificent Seven includes Google parent Alphabet , Apple , Instagram owner Meta Platforms , Microsoft , Nvidia and Tesla . Nvidia outpaced the cohort in 2023, more than tripling in value amid a wave of investment in its leading artificial intelligence chips. Apple, the relative laggard of the Magnificent Seven, rose nearly 50% in 2023, doubling the S & P 500’s gain. A CNBC index tracking the stocks on Wednesday is headed for its fourth straight day of declines, stretching back to the final two sessions of 2023. .MAG7 1M mountain The CNBC Magnificent Seven index over the past month. On Tuesday, we trimmed our position in all six of the Magnificent Seven stocks we own — a disciplined decision to ensure profits were not squandered and our portfolio of 33 stocks didn’t become too heavily…
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