Had you owned a portfolio that strictly consisted of the "Magnificent Seven" stocks over the past decade, you'd have absolutely crushed the market. But these businesses have all generated entirely different returns. One company stands head and shoulders above the rest.
And it's the best performing Magnificent Seven stock in 2026.
Image source: The Motley Fool.
At a $5.6 billion market capitalization, Nvidia (NVDA +2.77%) is the world's most valuable enterprise. Its shares are up 23.8% this year (as of Sept. 30). Nvidia's stock has skyrocketed 13,600% in the last 10 years, so the gain in 2026 looks unremarkable in the grand scheme of things.
What's interesting is that the artificial intelligence (AI) stock has become cheaper across various valuation metrics. Nvidia's price-to-earnings (P/E) ratio has fallen 38% this year and now sits at a reasonable 28.5. This means that the fundamentals have driven share gains.
NASDAQ: NVDA
Key Data Points
It's hard for bullish investors not to get excited by the valuation. Shares trade at a forward price-to-earnings (P/E) ratio of 24.9. Given Nvidia's net income grew at a compound annual growth rate of 113% over the trailing three-year period, the business looks like a no-brainer buying opportunity.
The risk, however, is that the durability of the AI boom is a massive unknown variable. Nvidia's success rests solely on the hyperscalers and its other customers continuing to spend huge sums on its powerful graphics processing units. There is no precedent for this build-out.
Investors thinking of buying the stock must grapple with this uncertainty.
