Josh Brown Urges Shift From Magnificent 7 as Alphabet Lifts AI Capex to $195 Billion-$205 Billion
Updated
Updated · CNBC · Jul 23
Josh Brown Urges Shift From Magnificent 7 as Alphabet Lifts AI Capex to $195 Billion-$205 Billion
2 articles · Updated · CNBC · Jul 23
Summary
Josh Brown told investors to rotate out of the Magnificent 7 and other hyperscalers in the second half, arguing AI gains are spreading to a wider set of stocks.
Alphabet’s move to raise 2026 capital spending to $195 billion-$205 billion helped trigger Thursday selling in hyperscalers, with Meta, Microsoft and Amazon all lower.
Brown said non-hyperscalers showing AI-driven earnings upside are better positioned, highlighting insurers Travelers and Chubb as early beneficiaries of efficiency and productivity gains.
Industrials also fit the broadening-out trade, he said, pointing to Caterpillar and GE Vernova; on Thursday, Caterpillar rose about 1% and GE Vernova gained 5%.
His broader message was that investors no longer need hyperscalers to lead every AI rally because the spending boom is creating more ways to profit across the market.