T. Rowe Price Manager Drops Tesla From 'Magnificent Seven' Roster
Fund manager David Giroux replaces Tesla with a new tech giant while arguing Big Tech remains fairly valued.
One of Wall Street's more closely watched portfolio managers has reshuffled the informal but market-moving roster known as the 'Magnificent Seven,' removing Tesla and installing a replacement tech giant in its place. David Giroux, a fund manager at T. Rowe Price, made the call as part of a broader assessment of where large-cap technology stocks stand after years of extraordinary gains.
Giroux's argument cuts against a narrative that has dominated financial media: that mega-cap technology is dangerously overvalued. In his view, Big Tech as a category does not constitute a bubble, a stance that carries weight given T. Rowe Price's scale and his own track record. The distinction matters for investors who have been second-guessing their allocations to the sector amid persistent interest-rate uncertainty.
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Tesla's removal from his personal iteration of the group reflects a divergence that analysts have quietly flagged for months — the electric vehicle maker's business fundamentals and valuation dynamics have increasingly set it apart from the software- and cloud-centric companies that define the rest of the cohort. While Tesla retains a tech-adjacent identity, its exposure to manufacturing cycles, margin pressure, and competitive intensity in EVs places it in a different risk category.
Beyond the headline reshuffle, Giroux's commentary is notable for where he does see opportunity: healthcare and utilities. Both sectors are traditionally considered defensive, but in the current environment they offer a combination of reasonable valuations and durable cash flows that growth-heavy portfolios may lack. This pivot toward value-oriented diversification suggests a measured repositioning rather than an outright retreat from equities.
For retail and institutional investors alike, the signal here is less about any single stock and more about how sophisticated managers are thinking about concentration risk as the Magnificent Seven narrative matures. Continue reading at MarketWatch.com
