Apple, Microsoft, Google, Amazon, Meta, Tesla, NVIDIA. These seven stocks make up nearly 30% of the S&P 500. I broke down the valuations to see which ones still offer value.

Let's cut through the noise and look at actual numbers. I've analyzed the current valuations of all seven mega-cap tech stocks to figure out which ones are reasonably priced and which are getting ahead of themselves.

Starting with the relative bargains. Google trades at 24.3x earnings with a 6.2x price-to-sales ratio. That's remarkably cheap for a company with their moat and growth profile. The market is underestimating their AI integration into search and cloud. They're also buying back stock aggressively, which should provide support.

Apple and Meta both trade around 29x earnings. For Apple, that's fair value given their services transition and capital return program. For Meta, it's potentially cheap considering the margin expansion story and the fact that they've massively cut costs while maintaining revenue growth.

Microsoft at 34x earnings looks expensive on the surface, but their cloud business is accelerating and they're the best-positioned to monetize AI through Office and Azure. I'm comfortable with the premium here.

Now the expensive ones. Amazon at 68x earnings is pricing in a lot of AWS growth. The retail business isn't profitable enough to justify this multiple. Tesla at 72x is still riding the EV narrative, but competition is intensifying and margins are compressing. NVIDIA at 51x with a 28.6x price-to-sales ratio is priced for perfection.

Here's my portfolio allocation recommendation. Core holdings should be Google and Microsoft. These offer the best combination of value and quality. Apple and Meta are solid secondary positions. Amazon, NVIDIA, and Tesla are more speculative - size them accordingly based on your risk tolerance.

The key thing to remember is that expensive stocks can get more expensive, and cheap stocks can stay cheap. Valuation is just one input in the decision-making process. But at current levels, I'd be overweight the cheaper names in this group.

One more thing to watch is correlation. These seven stocks tend to move together, which means they don't provide as much diversification as you might think. Make sure you have exposure beyond just mega-cap tech.