AI Bubble? Artificial Intelligence (AI) Stock Bubble could be forming now. Share price of Arm Holdings (ARM -3.60%) has jumped drastically. Share price of Super Micro Computer (SMCI) a maker of servers and storage equipment that work well for running AI models, is up 169% year to date, and shares of Nvidia (NVDA), the flagship for the generative AI revolution, are up 46% this year after more than tripling last year. Such mateoric rise show there is a lot of hype with the stocks. So what if the bubble burst? Stock volatility is an opportunity to make money. These are rock solid stocks that can support their share prices’ rise. Nvidia, for example, reported that revenue more than tripled in its third-quarter earnings report, and profits jumped by 12 times. In fact the stock's price-to-earnings valuation has come down over the last year as earnings growth has outpaced the stock price's growth.
Wall Street has mostly underestimated the growth of AI hardware stocks thus far.
If AI Bubble Pops, What To Buy?
The AI hype seems to be relentless, supporting the rise of the overall market and related sectors.
Investors can't help but worry that the AI bubble will burst like the dot.com bubble did in 2000.
If the AI bubble pops, are there any safe-haven sectors or new growth points to invest in?
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