As of market close on April 22, each "Magnificent Seven" stock has a negative price return in 2025. Among this cohort of megacap technology stocks, Microsoft (NASDAQ: MSFT) and Meta Platforms (NASDAQ: META) have dropped by the least amounts -- falling by 13% and 14.5%, respectively.

Both companies are set to report earnings for the first calendar quarter of 2025 on April 30. Let's explore why Microsoft and Meta could be good buys right now, despite ongoing turbulence in the stock market.

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What road bumps could Microsoft and Meta face in the short term?

I can't think of a bigger potential headwind for technology businesses right now outside of the new tariff policies. Both Microsoft and Meta are investing billions into AI infrastructure -- from Nvidia chips to custom silicon engineering, data center buildouts, and more.

The details surrounding which items and raw materials are subject to tariffs are complex. I think it's reasonable that both Microsoft and Meta could be looking at higher costs related to their AI infrastructure plans. In addition, it's not entirely clear how corporations are planning for how tariffs could impact their business operations.

As a result, companies could be preparing to scale back spending in areas such as cloud computing, cybersecurity, or advertising -- all of which would lead to decelerating sales for Microsoft and Meta. A slowing sales base coupled with rising prices would take a toll on profitability for each business.

One way to mitigate shrinking profits is for Microsoft and Meta to scale back their own AI capital expenditure plans. However, investors may not be encouraged by that choice since AI is the foundation of each company's growth narrative right now. Slowing that down for the sake of near-term profitability may not sit well with investors.

Why I still like Microsoft for the long run

I see the ongoing sell-off across the tech sector as an opportunity to buy the dip in high-quality names. Right now, Microsoft's forward price-to-earnings (P/E) ratio of 28 is slightly below the company's three-year average.

MSFT PE Ratio (Forward) data by YCharts

Even though IT budgets could be operating under tighter controls for the time being, I tend to think that businesses are going to identify cost savings in areas outside of mission-critical infrastructure such as cloud computing and cybersecurity software.

Although I'm not expecting a monster quarter from Microsoft next week, I remain cautiously optimistic that cloud growth from Windows Azure will show some signs of resilience. When you complement this with Microsoft's diversified ecosystem that includes personal computing, social media (LinkedIn), gaming, and more, I see Microsoft as a business that is relatively insulated from a possible economic slowdown caused by the tariff environment.

Why I still like Meta for the long run

On the surface, you might think that Meta is facing outsized pressure compared to its peers given the company really only has two sources of growth: advertising and the metaverse. Candidly, the company's metaverse ambitions are far from reaching widespread scale or profitability, and the digital advertising landscape is packed with competition from the likes of Alphabet, TikTok, and Snap, just to name a few. With that said, I think these are surface-level arguments.

Meta's relative price resilience compared to its Magnificent Seven peers could suggest that investors are less worried about the company's growth prospects. I think this makes sense, too. I don't see tariffs having much of an impact on Meta's business overall. Similar to Microsoft, the company could witness a brief slowdown in revenue growth, but I don't think it will be detrimental.

With leading platforms including Facebook, WhatsApp, and Instagram in its ecosystem, Meta is in a lucrative position to continue monetizing its billions of users -- especially as AI tailwinds unlock new opportunities in the consumer market.

META PE Ratio (Forward) data by YCharts

As of this writing, Meta is trading right in line with its three-year average forward P/E. Considering the company has made huge strides in the world of AI to help diversify the business over the last three years, it would appear that investors aren't applying much value to this potential growth right now.

Remember to think long term

The big thing investors should keep in mind is that these tariff policies could change at any time. Moreover, even if trade negotiations with other countries linger to the point of an economic slowdown, such a cycle won't last forever.

In the meantime, investors are continuing to sell off growth stocks given all of the uncertainty in the market right now. In my eyes, Microsoft and Meta are trading for reasonable valuations and I think investors should take advantage, buy the dip while it lasts, and prepare to hold on for the long term.

Should you invest $1,000 in Meta Platforms right now?

Before you buy stock in Meta Platforms, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Meta Platforms wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $594,046!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $680,390!*

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*Stock Advisor returns as of April 21, 2025

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Adam Spatacco has positions in Alphabet, Meta Platforms, Microsoft, and Nvidia. The Motley Fool has positions in and recommends Alphabet, Meta Platforms, Microsoft, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

For the last few years, Tesla (NASDAQ: TSLA) CEO Elon Musk has spoken repeatedly about his vision to turn his electric vehicle (EV) company into a full-blown artificial intelligence (AI) operation. One of the primary ways AI is expected to revolutionize Tesla's business is through autonomous driving.

Musk doesn't just want to integrate self-driving technology into Tesla cars for consumers to enjoy, though. Rather, he is looking to create a fleet of autonomous Tesla cars that people can hail at virtually any time. This initiative is known as the Robotaxi, and it's become one of the biggest sources of excitement for Tesla bulls ever since Musk gave the public a sneak peek late last year.

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While the idea of Robotaxi has certainly garnered a lot of attention, Tesla is not the only major technology company exploring the prospects of AI in the automobile market. In the piece below, I'm going to explore why I think some of the moves billionaire hedge fund manager Bill Ackman has been making as of late could spell trouble for Tesla and its autonomous vehicle vision.

Did Ackman just beat Tesla at its own game? Read on to find out more.

Step 1: Alphabet is rivaling Tesla in the autonomous vehicle market

Ackman is the CEO of hedge fund Pershing Square Capital Management. Unlike other hedge fund managers, one of Ackman's notable attributes is that he tends to keep Pershing Square's portfolio limited to a small number of stocks, generally owning positions in 10 or so companies at a time.

Since AI burst onto the scene as the market's hottest trend a couple of years ago, one mega-cap tech stock that's been relatively polarizing is Alphabet (NASDAQ: GOOGL). Some skeptics argue that Alphabet's dominance in internet search via Google could be threatened by the rise of ChatGPT and other large language models (LLMs). In addition, Meta Platforms and Amazon are becoming increasingly popular areas for advertisers to invest their budget over the likes of Alphabet-owned properties Google and YouTube.

Nevertheless, Ackman took a liking to Alphabet and began building a position in the company a couple of years ago. The obvious thesis around Alphabet as an AI play is that the company has the ability to integrate new services across its ecosystem -- from advertising, cloud computing, cybersecurity, workplace productivity, internet search, and more.

However, one area that receives virtually no attention pertaining to Alphabet's AI ambitions is autonomous driving.

Over the last several years, Alphabet has quietly built an impressive autonomous vehicle operation of its own called Waymo. Today, Waymo taxis are already serving customers in major metropolitan areas, including Phoenix, San Francisco, Los Angeles, and Austin.

Step 2: Robotaxis could revolutionize Uber's business

Earlier this year, Ackman took to social media platform X (formerly Twitter) in which he revealed that Pershing Square took a position in ride-hailing leader Uber Technologies (NYSE: UBER). Similar to Alphabet, Pershing Square's investment thesis around Uber primarily revolved around the company's valuation relative to its growth profile. While the firm thinks Uber's global scale and diversified services operation provide the company with a unique ability to expand profit margins over the coming years, there is a more subtle tailwind that could accelerate its growth as well.

According to Pershing Square's annual investor presentation from February, autonomous vehicle developers may choose to partner with taxi operations, such as Uber, due to the company's existing base of 170 million customers worldwide. In other words, Uber's value proposition is that it already has an enormous, sticky base of consumers that autonomous vehicle businesses wouldn't need to try and acquire themselves. In addition, Pershing Square's stance is that as autonomous vehicle fleets scale and become more mainstream, this dynamic provides an opportunity for the entire rideshare market to expand as well.

You might wonder how autonomous vehicles could benefit Uber's business. Think about other service-oriented businesses that act as distributors. Airbnb doesn't build its own physical infrastructure, unlike hotels. Rather, it serves as a platform on which consumers can book a trip, and Airbnb makes money by brokering that transaction.

In the same way, Uber does not need to spend billions building its own fleet of autonomous vehicles. Rather, it can strike partnerships with other companies developing self-driving technology and simply serve as a distribution channel. This mitigates a lot of risk, as Uber stands to benefit from a number of different companies that may choose to leverage its platform for a robotaxi service. Meanwhile, if Tesla does not pull off its goals in autonomous driving or fails to scale its own fleet, the company will likely be in a tough position in terms of growth opportunities.

Step 3: Hertz could be the missing piece to Ackman's autonomous vehicle vision

Just a few days ago, Ackman took to X again to reveal Pershing Square's latest big move: building a position in car rental stock Hertz (NASDAQ: HTZ). Once again, Ackman provided a long list of detailed financial analyses in his post and made the case for why he thinks Hertz is trading for a great value.

However, there was a sentence in the last paragraph of the post that really caught my eye.

Ackman wrote, "What if Uber partnered with Hertz on an AV [autonomous vehicle] fleet rollout over time?"

Such an idea could make a ton of sense. By merging car rentals, ride-hailing, and autonomous vehicle technology, Hertz could transform into a robotaxi operation of its own. Instead of relying on foot traffic for its services at airports and other venues, Hertz could rent self-driving cars (perhaps from Waymo) on the Uber app. As a result, Hertz removes the variability of the middleman (human drivers) but still benefits from a consistent flow of renters via Uber's installed base. In turn, Hertz could unlock steadier revenue streams and improve its unit economics on its existing vehicle infrastructure.

Ackman could be triangulating an AI trade for the ages

Admittedly, the idea of a three-way partnership between Alphabet (Waymo), Uber, and Hertz might seem like a pipe dream. But remember, Ackman is an activist investor -- often working with a company's executive leadership to identify ways to improve profitability and scale the overall operation.

Given his public statements, I think it's reasonable to say that Pershing Square could see Alphabet, Uber, and Hertz as a cheaper way to invest at the intersection of AI and autonomous driving compared to Tesla and its lofty valuation.

But at a deeper level, I think Ackman could be in the early stages of triangulating an AI trade for the record books. Should Waymo, Uber, and Hertz go on to work together in the world of autonomous vehicle fleets, Ackman would be in a position to benefit from three different opportunities -- as opposed to betting the farm on just one player such as Tesla.

Should you invest $1,000 in Alphabet right now?

Before you buy stock in Alphabet, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Alphabet wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $594,046!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $680,390!*

Now, it’s worth noting Stock Advisor’s total average return is 872% — a market-crushing outperformance compared to 160% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of April 21, 2025

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Adam Spatacco has positions in Alphabet, Amazon, Meta Platforms, and Tesla. The Motley Fool has positions in and recommends Airbnb, Alphabet, Amazon, Meta Platforms, Tesla, and Uber Technologies. The Motley Fool has a disclosure policy.

Right now, there are only seven public companies that are trading at a market capitalization north of $1 trillion. The exclusive list of trillion-dollar stocks includes Apple, Microsoft, Nvidia, Amazon, Alphabet, Meta Platforms, and Berkshire Hathaway.

Beyond trillion-dollar stocks, the next three largest companies in the world as measured by market cap are Broadcom, Tesla, and Taiwan Semiconductor Manufacturing. Do you see any themes here?

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With the exception of Berkshire, each trillion-dollar or near-trillion-dollar business dominates the technology sector. The next largest company after those referenced above is retail specialist Walmart (NYSE: WMT). With a market value of approximately $760 billion, Walmart is the most valuable non-pure-play technology business on the planet besides Berkshire.

What's interesting is that each company valued higher than Walmart could be facing some unwelcome deceleration across their various businesses thanks in large part to new tariff policies. A common fear in the stock market right now is that tariffs could lead to higher prices (inflation) for consumer goods and raw materials, thereby sparking an economic slowdown (recession).

As a contrarian, I think a tariff-induced slowdown could actually benefit Walmart. Let's explore why Walmart's business is ideally positioned to maneuver around any crises caused by tariffs. From there, I'll make the case for why Walmart could soon earn its entry into the trillion-dollar club.

Walmart's business is built for a tough economy

Walmart is primarily known as a brick-and-mortar powerhouse -- offering consumers a variety of goods across apparel, consumer electronics, produce, home remedies, and much more. While that might not sound too different from stores like Target or CVS, Walmart's main value proposition is its attractive prices. Cost-conscious shoppers tend to gravitate toward stores such as Walmart during periods underscored by rising prices or economic uncertainty.

To back this idea up, let's take a look at some key performance indicators for the retail juggernaut over the last few years.

US Inflation Rate data by YCharts

The chart above illustrates trends seen in Walmart's revenue and gross profit, indexed against inflation rates over the last five years. In addition, I've included the brief (but important) COVID-19 recession -- as illustrated by the grey column on the left. Let's unpack what's happening here.

Following the COVID-19 recession in early 2020, inflation levels started accelerating -- peaking at around 9% in mid-2022. During this period, Walmart's revenue and gross profit started to steadily climb. This is an impressive feat, considering many retailers were plagued by lower foot traffic during the pandemic.

Not only are Walmart's prices one way to attract to consumers, but the company has also done a stellar job complementing its physical retail storefronts with an e-commerce marketplace of its own -- providing it with multiple avenues to monetize shoppers.

Taking this a step further, let's analyze some important metrics retailers use to gauge the health of their business. During the fourth quarter of Walmart's fiscal 2025 (ended Jan. 31), the company recognized same-store sales growth of 4.6%, while transactions rose by 2.8% and average ticket size grew by 1.8%. This means that Walmart is seeing more people come to its stores and spending more money while they are there.

Although same-store sales, transaction volumes, and average order size can be variable in the retail space, I think any concerns related to this are mitigated by Walmart's ability to hold onto its shoppers. The big takeaway I gather from the chart above is that Walmart's revenue and gross profit continue to steadily rise, even as inflation levels have cooled over the last two years.

I think ongoing economic uncertainty from tariffs could wind up being a tailwind for Walmart and its ability to lure consumers in and keep them part of its ecosystem in the long run.

What would it take for Walmart to reach a $1 trillion valuation?

For the fiscal year ended Jan. 31, Walmart's earnings per share (EPS) totaled $2.42. Given the company's current share price of $95, Walmart stock trades for a price-to-earnings (P/E) ratio of approximately 39.

A $1 trillion market capitalization implies roughly a 32% increase Walmart's current valuation of $760 billion. This means in order to reach the trillion-dollar club, Walmart stock would need to be trading around $125 per share.

If I assume that the company expands both its EPS and P/E ratio by 15%, that would imply future earnings of $2.81 and a P/E ratio of 45 for Walmart. In turn, this results in a future share price of about $126, which would put Walmart just above a trillion-dollar market capitalization.

I think this level of EPS growth is attainable for Walmart, especially against the backdrop of a cloudy economic picture. The bigger question mark is whether investors will start applying a premium multiple to Walmart -- viewing it as a more essential player in the retail arena, all while giving the company credit for some of its higher-margin pursuits beyond brick-and-mortar sales.

While the exercise above is rooted in simple math, I am cautiously optimistic that Walmart could emerge as a member of the trillion-dollar club sooner rather than later. Investors looking for opportunities that may be slightly more insulated from tariffs or economic slowdowns may want to consider a position in Walmart right now.

Should you invest $1,000 in Walmart right now?

Before you buy stock in Walmart, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Walmart wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $594,046!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $680,390!*

Now, it’s worth noting Stock Advisor’s total average return is 872% — a market-crushing outperformance compared to 160% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of April 21, 2025

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Adam Spatacco has positions in Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Berkshire Hathaway, Meta Platforms, Microsoft, Nvidia, Taiwan Semiconductor Manufacturing, Target, Tesla, and Walmart. The Motley Fool recommends Broadcom and CVS Health and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

For the last week, financial news programming has covered one particular topic non-stop: U.S. President Donald Trump's new tariff policies.

It seems like every few minutes, a new economist, hedge fund manager, or business executive is being broadcast on television -- each providing a unique perspective on the effects these tariffs could have on the economy. Given the wide array of conflicting viewpoints, it's not surprising to see the capital markets witness sharp sell-offs and rebounds based on the latest breaking news headline.

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Amid all the chaos, some recent commentary from billionaire hedge fund manager and CEO of Omega Advisors Leon Cooperman stuck out to me. Let's take a look at his thoughts on the current market, and explore how his viewpoints can help investors navigate uncertainty during this heightened period of tension in the stock market.

How is Leon Cooperman preparing for market volatility?

During a recent panel discussion on CNBC, Cooperman was asked about his thoughts on the tariffs, the ongoing market sell-off, and even some of his fund's specific positions.

Cooperman admitted that he would not be shocked if stocks exhibit uninspiring returns for an "extended period." While that might suggest some opportunity to buy dips in depressed stock prices, Cooperman also made it clear that he's being careful right now. To be specific, he said he isn't buying the current weakness because he doesn't trust this level of extreme volatility.

Why doesn't Cooperman trust the weakness in the market?

During the interview, Cooperman was asked what he thought would happen if the tariff policies were lifted or at least relaxed on some levels. He confidently replied by saying the markets would experience a short-term rally, but doubled down on his stance that investors may not have seen the bottom just yet.

Well, on April 9, President Trump did in fact institute a pause on his initial tariffs -- replacing them with a 10% tariff for 90 days for many of the countries the U.S. trades with.

^SPX data by YCharts.

The chart above illustrates the returns of the S&P 500, Nasdaq Composite, and Dow Jones Industrial Average since April 2 -- the day President Trump announced his initial tariff agenda. Each of these indices dropped by at least 11%. However, just as Cooperman predicted, stocks began to rally quite dramatically following Trump's new tariff pause on April 9. While each index is still down since April 2, the rebound illustrated above was sharp, to say the least.

Cooperman's point about trust makes a lot of sense

Given that the markets tanked following the initial tariff announcement last week, it makes sense that shares would rally following some positive news, just as Cooperman suggested. However, in a way, neither of these actions necessarily makes sense on a fundamental level -- and perhaps this is why Cooperman says he isn't totally trusting the weakness in the market right now.

What I mean by this is that the initial sell-off and current rally are both based purely on tariff narratives. News alone is not an inherent reason to buy or sell a stock. Rather, the constant ebbing and flowing of stock prices right now appears to be driven by emotion -- how investors are feeling based on a specific piece of news.

The thing about tariffs is that they can change at the flick of a switch. For example, while President Trump relaxed his policies for most trade partners on April 9, he also doubled down on raising tariffs for China. This is important, because at any moment these policies could change once again -- and depending on the country or the specific goods targeted, it could have massive ripple effects on certain industries and end markets.

I think Cooperman is right to remain suspicious. Right now, I think the current price action we're seeing is intensely rooted more in emotion than logic, making it incredibly challenging to navigate which stocks could present good value at this point.

Should you invest $1,000 in S&P 500 Index right now?

Before you buy stock in S&P 500 Index, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and S&P 500 Index wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $495,226!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $679,900!*

Now, it’s worth noting Stock Advisor’s total average return is 796% — a market-crushing outperformance compared to 155% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of April 10, 2025

Adam Spatacco has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Cathie Wood is the CEO and Chief Investment Officer of Ark Invest, which offers a small catalog of innovation-focused exchange-traded funds (ETFs). Those funds' portfolios tend to be dominated by smaller, speculative companies in emerging industries.

While these investment preferences may suggest that Wood has an appetite for risk, her funds also hold a number of blue chip stocks -- including one "Magnificent Seven" stock she just scooped up more of amid the Nasdaq's sharp sell-off.

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Wood just bought Nvidia

Wood has an interesting relationship with semiconductor behemoth Nvidia (NASDAQ: NVDA). Although she's held positions the chipmaker for years, she actually has been a seller of the stock more often than a buyer.

Ironically, she dumped nearly all of her Nvidia position around November 2022 -- right around the time ChatGPT was released and artificial intelligence (AI) emerged as the next big megatrend.

Since the start of 2025, Nvidia's stock price has been under a lot of pressure due to a host of factors: China's DeepSeek models, rising competition in the GPU space from Advanced Micro Devices and cloud hyperscalers designing their own custom AI chips, and most recently, macro uncertainty around President Donald Trump's tariff and trade policies.

Now, with Nvidia shares down by 24% from the all-time high they hit just a few months ago, Wood may have a second chance. Between April 7 and 8, her funds purchased roughly 341,000 shares of Nvidia, essentially doubling Ark's stake in it.

Why does Nvidia look tempting now?

From a macro perspective, the secular tailwinds continue to support the growth of the data center industry, and Nvidia remains well positioned to continue capturing a large proportion of the expanding market for AI accelerator chips. Consider what AI's biggest spenders have up their sleeves. Cloud hyperscalers Amazon, Alphabet, and Microsoft all announced earlier this year that they intend to continue investing heavily in infrastructure to support AI. Meta Platforms expressed a similar outlook during its fourth-quarter earnings call.

On a combined basis, these four Magnificent Seven companies' AI capital expenditures could top $320 billion in 2025 alone. Each is a major customer of Nvidia, so I'm optimistic about its prospects relating to their data center build-outs.

In addition, Nvidia recently released its newest GPU architecture, Blackwell, sales of which have so far outperformed management's expectations. And while the early indicators for Blackwell are encouraging, Nvidia is on track to deliver its successor GPU architecture in a couple of years. This all positions Nvidia well for robust long-term growth as the AI narrative continues to unfold.

Even in the face of encouraging business trends, Nvidia stock has gotten decimated during the ongoing Nasdaq sell-off. It trades at a price-to-earnings (P/E) multiple of about 39. It has only rarely been this low in more than five years.

NVDA PE Ratio data by YCharts.

While Wood's purchases of Nvidia aren't necessarily large compared to her core holdings, I find her decisions to buy the stock on consecutive days this week pretty interesting. Nvidia's underlying business looks solid, and with the stock now trading at a historically cheap valuation, it's just too hard to pass up -- even for a more speculative investor such as Wood.

I think growth investors with long-term time horizons should consider following Wood's lead here and take advantage of Nvidia's slide. The long-term outlooks for the company and the AI narrative in general still look positive. In that context, the current sour sentiment in the stock market looks to have created a potentially lucrative opportunity here for patient investors who can stomach some volatility.

Should you invest $1,000 in Nvidia right now?

Before you buy stock in Nvidia, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nvidia wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you’d have $495,226!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $679,900!*

Now, it’s worth noting Stock Advisor’s total average return is 796% — a market-crushing outperformance compared to 155% for the S&P 500. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

See the 10 stocks »

*Stock Advisor returns as of April 10, 2025

Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Adam Spatacco has positions in Alphabet, Amazon, Meta Platforms, Microsoft, and Nvidia. The Motley Fool has positions in and recommends Advanced Micro Devices, Alphabet, Amazon, Meta Platforms, Microsoft, and Nvidia. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

We're just four months into the year and there's already been a multitude of events that have rocked the capital markets.

Back in January, a Chinese artificial intelligence (AI) start-up called DeepSeek shook investors to the core as the company claimed to build its models on older, less sophisticated IT architectures than American AI developers had been using. While these fears subsided relatively quickly, the market volatility continued thanks to mixed opinions on important economic data related to inflation and jobs reports.

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Most recently, the event that has caused the biggest stir in the stock market is President Donald Trump's new tariff agenda. Since he announced his global tariff policies on April 2, stocks have been whipsawing so dramatically it's become both jarring and disorienting for investors to figure out what to do.

During times like these, a famous Warren Buffett quote always comes to mind. Let's assess the magnitude that the tariff news has had on the market. More importantly, we'll explore the mindset of the "Oracle of Omaha" -- which could help investors moderate any panic and fearful emotions they may be feeling right now.

Trump's tariffs are wreaking havoc on the markets

The chart below illustrates the returns of both the S&P 500 and Nasdaq Composite so far this year. As I alluded to above, there have been multiple drop-offs across both indices throughout the first few months of 2025. However, the clear anomaly shown below is the precipitous decline that occurred in early April -- immediately after Trump's tariff policies became public:

^SPX data by YCharts.

Even though it's scary, this market dip presents opportunity

The stock market is a fascinating case study in human psychology. It's a medium that reflects a wide range of emotions. When the markets are soaring, most people are euphoric. When the markets are crashing (like they are now), most people run for the hills.

But even during the so-called good and bad times, there exist a small cohort of people known as contrarians. These investors go against the grain; they don't adhere to mainstream ways of thinking.

When the stock market is roaring, a contrarian may become concerned that valuations are becoming disconnected from the performances of actual businesses. In other words, contrarians will think that people are investing more into narratives than concrete fundamentals. By contrast, when valuation levels drop, a contrarian may be inclined to start putting money to work as stocks become more attractive at their normalized prices.

Buffett is a well-known contrarian. And right now, I can't stop thinking about his famed line, "You want to be greedy when others are fearful, and you want to be fearful when others are greedy." On the surface, that philosophy might not entirely resonate with the average investor. But below, I'll make the case for why Buffett's logic makes a lot of sense.

Remember to keep the long term in focus

The chart below illustrates the performance of the S&P 500 and Nasdaq Composite over the last two decades. Each of the grey-shaded columns indexed against the performance of the S&P and Nasdaq represents a different recessionary period.

^SPX data by YCharts

Do you notice anything? Naturally, right around the time a recession went into effect, both indices started to fall. However, following the recessions both the S&P 500 and Nasdaq started to rise again -- eventually reaching new highs.

I'm not showing this trend because I'm predicting a recession. Rather, I'm making the case that the stock market is quite a resilient place in the long run -- even if emotions can sometimes drive a lot of the action in the near term. These dynamics underscore that some brave investors (like Buffett) were actually buying during historical periods of prolonged sell-offs and market crashes. In other words, some investors were greedy when most others were fearful and panic-selling.

I'll admit that it's really difficult to identify stocks that may be oversold or that are less exposed to tariffs. Instead of going down those rabbit holes, I think a prudent strategy is to simply buy the overall market right now. What I mean by that is to consider putting some money to work in exchange-traded funds (ETFs) such as the Vanguard S&P 500 ETF (NYSEMKT: VOO), SPDR S&P 500 ETF Trust, or the Invesco QQQ Trust.

Each of these funds provides investors with diversified exposure in the form of multiple industry sectors and a healthy mix of growth and value stocks. And as the chart above makes clear, the S&P 500 and Nasdaq tend to exhibit strong rebounds following periods of economic turmoil.

I think that using a strategy of dollar-cost averaging into these major indices will wind up being a savvy move years down the road.

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Adam Spatacco has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Vanguard S&P 500 ETF. The Motley Fool has a disclosure policy.

For the past few years, investors have become enamored with the prospects of artificial intelligence (AI) technology. But for the most part, developers have been touting the same carousel of ideas -- explaining how AI is leading to breakthroughs in training large language models, helping build autonomous systems for vehicles, and bringing unprecedented levels of efficiency to the workplace.

Although these use cases fetched a lot of intrigue for a while, investors are beginning to look for something new to get excited about now. Enter quantum computing -- a pocket of the AI realm management consulting firm McKinsey & Co. estimates to be worth $1.3 trillion by 2035. Essentially, this form of computing uses principles of quantum mechanics to process information exponentially faster than a "classical" computer.

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For the past several months, executives at the largest AI businesses have started talking about the next revolutionary phase of modern computing. As is typical for a new megatrend, loads of companies are now marketing themselves as quantum computing darlings -- parroting talking points about how the technology is poised to benefit high-priority areas in healthcare, cybersecurity, and financial services, just to name a few.

Let's explore which companies are making waves in the world of quantum computing, and assess what opportunities are best for investors with a long-term time horizon.

These quantum computing stocks are getting loads of attention, but...

Seasoned investors know all too well that whenever a hot new area emerges within an already popular theme, opportunities seemingly begin popping up out of the woodwork. Take a look at the chart below and try to spot the anomaly.

RGTI data by YCharts

Do you notice anything a little odd? The share price returns for quantum computing stocks Rigetti Computing, IonQ, Quantum Computing, and D-Wave Quantum absolutely trounce the returns across both the S&P 500 and Nasdaq Composite over the last year. To add an extra layer of weirdness here, the share prices for these quantum computing stocks barely moved between January and October 2024 -- and then suddenly, they popped exponentially.

If you've never heard of these companies, there are good reasons. Chief among them is that each company above is only generating nominal levels of revenue. This makes sense, as quantum computing does not have much in the way of utility given the current state of the AI narrative. In other words, while the idea of quantum computing technology is exciting, there isn't much application for it today.

RGTI Revenue (Quarterly) data by YCharts

Nevertheless, the companies explored above have all managed to trade at valuation multiples that are completely disconnected from their underlying business trends (i.e., low revenue, heavy cash-burning operations).

Given the upside-down financial profiles of these companies, I'm hard-pressed to buy into a narrative that any of them will be around decades from now. Instead, let's look at some other opportunities that look better positioned for the long haul.

...these magnificent opportunities look better positioned for the long term

By now, I'm sure you're well aware that the "Magnificent Seven" stocks -- Amazon (NASDAQ: AMZN), Apple, Alphabet (NASDAQ: GOOG), Microsoft (NASDAQ: MSFT), Meta Platforms, Tesla, and Nvidia (NASDAQ: NVDA) -- dominate the AI narrative. For the most part, each of these companies hovers around overlapping use cases in AI -- from workplace productivity software, semiconductor chips, social media, self-driving cars, cloud infrastructure, and more.

However, Amazon, Alphabet, Microsoft, and Nvidia have all quietly been showcasing their own forms of progress in the area of quantum computing as well. For example, Amazon, Alphabet, and Microsoft have all developed their own series of quantum chips. In addition, Nvidia offers an extension of its compute unified device architecture (CUDA) software platform specifically geared toward quantum computing.

The jaw-dropping returns from IonQ, Rigetti, D-Wave, and Quantum Computing are rooted in hype around the idea of quantum computing and what opportunities might be multibaggers in the future. By contrast, Nvidia, Amazon, Alphabet, and Microsoft all have much stronger financial horsepower that allows them to consistently invest and hone their quantum roadmaps without taking a toll on existing AI initiatives that are actually being monetized as it stands today.

Furthermore, given that these Magnificent Seven cohorts have already built large and thriving AI businesses, quantum computing represents another thread that could stitch their broader AI ecosystems together -- helping them build even stronger businesses poised to grow for decades down the road.

While the Magnificent Seven stocks are currently under pressure during the ongoing Nasdaq sell-off, each company remains in a solid financial position for the long run. I see Nvidia, Alphabet, Amazon, and Microsoft as far superior opportunities compared to the more speculative names I explored above.

Should you invest $1,000 in Nvidia right now?

Before you buy stock in Nvidia, consider this:

The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Nvidia wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.

Consider when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you’d have $578,035!*

Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than quadrupled the return of S&P 500 since 2002*. Don’t miss out on the latest top 10 list, available when you join Stock Advisor.

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*Stock Advisor returns as of April 5, 2025

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Adam Spatacco has positions in Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.