What goes up must come down. And what goes down… well, some are hoping they – all seven of them – must go back up again.

After serving as the driving force for a blistering market rise in 2023 and 2024, the so-called Magnificent Seven — that’d be Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla — have taken an epic stumble in 2025, shedding some $2 trillion in market value. In fact, the once mighty cohort is now trading at levels not seen since ChatGPT kicked off an AI frenzy. So the question remains: Can the Magnificent Seven ride again?

How Low Can You Go?

Between the DeepSeek moment, trade war uncertainty, and the threat of stagflation, there’s no shortage of reasons for the Mag 7’s tumble. And yet, not all the members’ falls from grace are equal. Microsoft has technically been the best of them, with share prices skidding by “only” 12% so far this year (still worse than the S&P 500’s roughly 10% slide). Tesla, meanwhile, facing weakening demand for its electric vehicles (while Chinese competitor BYD makes major breakthroughs), is the least magnificent among them.

Tesla’s share price has tumbled 36% year-to-date and nearly 50% since a December high. Crucially, its price-to-earnings ratio now sits at around 118x, compared with just about 35x at the end of 2022 (the start of the AI frenzy) and 70x at the end of 2023. Sans Meta, every other member of the group is trading below its pre-ChatGPT price-to-earnings ratio. Meta is trading at a somewhat more conservative 22x ratio, above its pre-ChatGPT level but roughly in-line with the rest of the class).

Which may be why, moving forward, some investors don’t see the group as moving in unison:

• “I would say it’s more like the Mag Five for us,” Siebert Financial investment chief Mark Malek told CNBC last week, noting that Tesla and Apple are the two to be left out for now.
• “As a stock picker, I would actually go one by one… There are opportunities,” Nelson Yu, head of equities at AllianceBernstein, told CNBC.

Seven’s a Crowd: Need more evidence of the group’s waning importance? In a Bank of America survey last week, fund managers flagged gold — which has surged in value so far this year — as the most crowded trade on Wall Street. It’s the first time in two years that managers named an asset other than the Magnificent 7 as the most crowded trade.

Bill Ackman revealed last week that his Pershing Square has amassed a nearly 20% stake in car rental giant Hertz and a vast cohort of traders rushed in behind him, driving the company’s share price through the sunroof of the hedge fund billionaire’s Model X.

If auto tariffs don’t stay in place for a long time, they might soon find themselves in reverse gear.

Betting on a U-Turn

Hertz’s recent track record leaves much to be desired: The rental-car company lost nearly $2.9 billion last year, citing depreciation of its vehicles. An electric-vehicle shopping spree that began in 2021 — complete with a deal to acquire 100,000 Teslas — looks especially bad in the rearview mirror. Demand for the vehicles has slipped — a March survey by Cars.com found searches for used Teslas fell 16% month-over-month — and their value has fallen rapidly, with electric vehicles overall depreciating 58% in five years, according to one recent study.

The company is also saddled with more than $6 billion in debt and is being sued by bondholders for roughly $300 billion related to a 2020 bankruptcy from which it emerged solvent. But Ackman laid out, in a lengthy tweet, how he is confident in management’s ability to pull off an operational turnaround, including remaking Hertz’s fleet, cutting operating costs, and boosting unit revenue to “improve profit margins over the next several years.” Hertz’s ace card, he added, is the prospective auto tariffs that have roiled markets:

• Analysts expect a 25% levy on imported automobiles ordered by President Trump — whom Ackman backed during last year’s election — to jack up the prices of used cars by thousands of dollars. Hertz owns roughly 500,000 vehicles worth about $12 billion, Ackman said, noting a 10% increase in used car prices would equal a $1.2 billion gain on its vehicle holdings.
• A lot of traders were convinced: Hertz shares closed up 100% last week, with almost all the gains coming after Pershing revealed its stake. Ackman also teased a potential partnership with Uber, earning a positive response from the ride-hailing giant’s CEO Dara Khosrowshahi, who replied he was “excited to brainstorm on how we can expand on our relationship!”

Ackman’s tariff assumption, of course, has one Cyber Truck-sized caveat: Trump is already considering pausing the auto tariffs or granting exemptions to some manufacturers as they sort out their supply chains, which could significantly blunt their impact.

Bargain Hunting: Based on Ackman’s calculation about used car valuations, one might assume traders would flock to other companies that stand to benefit. That hasn’t necessarily been the case: While rival car rental giant Avis Budget Group rose 19% last week, used car retailers saw limited movement. Carvana rose 3.8% last week, Autonation fell 0.3% and Group 1 Automotive, which sells new and used cars, dropped 2%. CarMax — which recently increased its used car inventory to get ahead of tariffs — fell 2.8%.

To LVMH CEO Bernard Arnault, the world has a new look and it’s unfashionably chaotic.

His luxury giant — which counts Louis Vuitton, Dior, Fendi, and Givenchy among its holdings — had a tumultuous week that included being briefly overtaken by French rival Hèrmes as la République’s most valuable firm. Investor worries about US tariffs have dragged its shares in Paris down 24% this year but Arnault, the world’s sixth-richest man as of Friday, is not pointing the finger at America.

Blame Brussels?

European luxury houses including LVMH, Hèrmes, and Chanel entered 2025 banking on well-heeled Americans as their best bet to offset weakening demand in China where, well before the latest trade conflicts, economic malaise was fueled by a slowing property sector, spiralling local government debt, and declining household consumption.

Instead, they ended up with a double whammy. There’s the US threatening 20% tariffs on products from the EU, currently subject to a 90-day pause, in a threat to one key market. And there’s the full-on trade war that’s broken out between the US and China, which threatens to further erode demand in Asia. When LVMH reported its first-quarter results last week, a surprise 5% drop in organic sales at its fashion and leather goods division — a luxury industry bellwether — was further off the mark than a strip mall Louis Vuitton handbag knockoff: Markets expected 1% growth. An 11% drop in LVMH Asia sales outside of Japan added to the worrying signs.

Speaking at LVMH’s annual shareholder meeting on Thursday, however, Arnault did not cast blame across the Atlantic:

• If 90 days of negotiations can’t yield a way to stop President Trump’s proposed 20% tariffs on the EU from taking effect, he told the meeting, “it will be Brussels’ fault.” The European Commission — the European Union executive branch headquartered a mere 80-minute train ride from Paris in the Belgian capital — negotiates trade deals for the bloc’s 27 member states.
• “Europe is not run by a political power but by a bureaucratic power that spends its time issuing regulations that are unfortunately imposed on all member states and that penalize our business sectors,” he said, urging EU countries to try and manage negotiations with Washington. He went on to call for a US-EU free trade agreement (something Trump advisor Elon Musk has wished for), and suggested that without one, his company could be forced to move production stateside.

LVMH makes 25% of its annual sales in the US, but if Arnault makes good on the pledge to add US production, previous efforts do not augur well. Reuters reported earlier this month that an LVMH Texas factory, whose opening Trump attended in 2019, has a 40% waste rate for leather goods, about twice the industry standard, because of frequent production errors. It’s one of the company’s worst-performing facilities in any country.

His Lucky Number: Whatever the challenges facing LVMH, they’ll be Arnault’s for a while longer. Over 99% of shareholders voted at the annual meeting to allow the 76-year-old to keep his job until he turns 85 by raising the maximum age of its CEO and chairman roles by five years. As rough a week it was for the company, it was even worse for aspiring successors.