Here’s the Best “Magnificent Seven” Stock to Buy in April, According to Wall Street

Apr 1, 2024 9:07 pm | News

“April showers bring May flowers.” But could they also bring a great opportunity to invest in high-profile mega-cap growth stocks? Maybe so.

You might not think the so-called “Magnificent Seven” stocks have much more room to run after delivering sizzling gains. However, analysts remain bullish about several of them — and one in particular. Here’s the best Magnificent Seven stock to buy in April, according to Wall Street.

Crossing names off the list

We can quickly cross several names off the list. Analysts believe some high-flying members of the Magnificent Seven will run out of steam.

For example, Meta Platforms (NASDAQ: META) shares have soared around 140% over the last 12 months. Wall Street expects the stock’s momentum will hit a brick wall. The consensus 12-month price target for Meta is a little lower than its current share price.

Nvidia (NASDAQ: NVDA) has been an even bigger winner, with its share price skyrocketing 240% during the same period. Again, though, analysts aren’t optimistic the chipmaker has much more room to run. The average price target for Nvidia reflects minimal upside potential.

It’s a similar story for Microsoft (NASDAQ: MSFT). Although the tech giant has delivered an impressive gain of more than 50% over the last 12 months, the path forward could be more difficult. The consensus price target for Microsoft is less than 1% above the current share price.

Wall Street isn’t much more bullish about Tesla (NASDAQ: TSLA). Even though it’s the worst performer in the Magnificent Seven over the last 12 months with shares falling instead of rising, the average price target for the electric vehicle maker reflects an upside potential of less than 2%.

The “A team”

That leaves the “A team” as the top contenders: Amazon (NASDAQ: AMZN), Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL), and Apple (NASDAQ: AAPL). All three stocks are running neck-and-neck as Wall Street’s favorite right now.

Amazon has been by far the biggest winner of these three over the last 12 months with its shares vaulting more than 80% higher. Analysts think the e-commerce and cloud services leader could have more room to run with the consensus price target nearly 7% above the current share price.

Google parent Alphabet is our runner-up. After the stock’s strong gain of almost 50% over the last 12 months, Wall Street thinks it can rise another 8%.

Perhaps surprisingly, analysts view Apple as the best Magnificent Seven stock to buy in April. The average 12-month price target for the iPhone maker is more than 8% above the current share price, reflecting a slightly higher upside potential than Wall Street sees for Alphabet.

Apple’s stock performance over the last 12 months has lagged well behind every Magnificent Seven stock except Tesla. The company reported year-over-year revenue growth of only 2% in the quarter ending Dec. 30, 2023.

Is Wall Street right about Apple?

I’d take analysts’ price targets with a grain of salt — or better yet, a shaker of salt. However, I think Wall Street could be right about Apple’s share price rising over the coming months.

The conventional wisdom is Apple has been left behind in the AI race. That’s partly because the company tends to keep its plans closer to the vest than most big tech companies. When investors don’t know what’s coming, they can sometimes think the worst.

But Apple will likely reveal its long-awaited AI strategy at its developer conference in June. CEO Tim Cook told shareholders at the annual meeting earlier this year the company is “investing significantly” in generative AI because of its “incredible breakthrough potential.” He added that he would share more details later in 2024.

It’s possible that Apple won’t reveal as much as investors hope or that its AI strategy doesn’t meet expectations. On the other hand, I won’t be surprised if the company delivers the “wow” that it’s been lacking for a while. Maybe, just maybe, this Magnificent Seven stock will soon become more magnificent.

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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Keith Speights has positions in Alphabet, Amazon, Apple, Meta Platforms, and Microsoft. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

Here’s the Best “Magnificent Seven” Stock to Buy in April, According to Wall Street was originally published by The Motley Fool

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