3 Reasons to Buy This "Magnificent Seven" Stock Now

The 1960 Western-themed "Magnificent Seven" stocks have driven the market higher in recent months. The S&P 500 reached a record high thanks to these technology stocks, confirming a bull market. More excitement awaits. Bull markets favour growth equities, so these players may thrive in the months and years ahead.

Get in on the Magnificent Seven story without buying shares of all these elite firms. Adding one or two to your portfolio could improve it over time. Which one to choose? Meta Platforms (NASDAQ: META) is a no-brainer buy today for three reasons, despite its over 40% rise this year.

1. AI dedication Meta is investing substantially in AI to integrate it into all of its products and services. Meta AI, the company's social media conversational assistant, is a start. Meta is training Llama 3, the latest iteration of the company's huge language model.

Meta maintains open-source software infrastructure for public usage. This is wise since feedback may help the company develop its technology and become an industry leader as more people use its platforms. By year's end, the tech giant hopes to have 600,000 GPUs to power its AI goals and will invest heavily in AI in 2024.

2. A profitable moat AI could boost Meta's earnings in the future, but Facebook, Messenger, WhatsApp, and Instagram are currently in charge. The company's moat, or competitive edge, makes these apps likely to grow revenue.

These apps attract advertisers, generating steady revenue for Meta. The company's competitive edge is that its programs are used internationally, making platform switching difficult. After all, many of your contacts may not use that platform. Over 3.1 billion people use Meta's apps daily.

Meta benefits from its social networking apps' broad appeal to young and old. These people use these apps professionally and recreationally. The company's AI breakthroughs may encourage consumers to spend more time on apps, making advertisers more likely to spend money there.

3. Shares are very inexpensive Meta has expanded earnings due to its social networking platform, which attracts advertising. Social media and AI have bright futures. Over the next five years, analysts predict double-digit growth for Meta, whose revenue has continually risen to record heights. That makes 24x projected earnings forecasts look inexpensive, giving investors a superb starting point.

Remember that the computation uses forecasts for next year, so this is a short-term view. This depiction doesn't account for future earnings when Meta's AI efforts may take off. All of this makes now the ideal moment to buy Magnificent Seven stock. Despite recent achievements, it has space to grow.

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