This Ain't 1999: 'Nvidia Is Cheaper Than It Was 26 Months Ago' — Market Expert Says Magnificent 7 Stocks Are Not In A Bubble

While some investors have been quick to call the recent rallies in Magnificent Seven stocks a "bubble," Ryan Detrick says that’s not the case. Detrick, the chief market strategist at Carson Group, joined Benzinga’s PreMarket Prep Wednesday to discuss market trends. 

Detrick provided numerous data points to illustrate the current state of the market. Among his charts, one highlighted the comparison between earnings growth and multiple expansion for the mega-cap firms known as the Magnificent Seven. According to Detrick's analysis, NVIDIA Corp NVDA has seen its earnings surge by over 250% since early 2022, while the company’s multiple has only expanded slightly more than 100%.

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“The earnings growth has been unbelievable,” Detrick said, talking about the mega-cap tech names. “There’s been a multiple compression the last 26 months on Nvidia. The stock’s cheaper than it was 26 months ago.”

Detrick acknowledged that the valuations of the Magnificent Seven are stretched, but he pointed out that their growth is driven by actual earnings, setting this situation apart from the dot-com bubble of the late '90s and early 2000s. He emphasized that the current scenario is different, as the growth in these big-tech companies is based on solid financial performance.

Detrick also pointed out, that despite Americans’ feelings that the economy is not strong, U.S. consumers are in one of the best positions in the last few decades. While many commentators and media outlets have focused on record debt, Detrick points out that the debt as a percentage isn’t much higher than it’s been historically.

“I would make the argument that the consumer is in a lot better shape than they tell us when we look at TV,” Detrick said. 

Watch Detrick’s full appearance on Benzinga’s PreMarket Prep below.

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Image RyanDetrick/CarsonGroup NicholasCappello/Unsplash