Semiconductor earnings surge on AI CapEx
The host argued that broad semiconductor exposure, particularly Nvidia, remains highly attractive as technological booms typically last longer than skeptics expect.
The argument
Despite acknowledging bubble risks, the host emphasized that Nvidia's valuation remains reasonable relative to future earnings projections (e.g., 15x 2027 EPS) and that outright shorting semiconductors is currently a risk not worth taking.
The thesis, stress-tested
✓ What validates it
- ✓Nvidia meets or exceeds its projected 2027 EPS targets
- ✓Hyperscalers continue to increase or maintain elevated AI CapEx budgets in upcoming quarterly reports
▸ Risks discussed
- ▸The massive capital expenditure on AI may fail to generate a sufficient return on investment
- ▸The unsustainable status quo of chipmakers earning huge profits while model companies lose money could abruptly end
Hear it yourself
"We got a very special conversation talking about investing in AI and semiconductors on the long side, on the short side as well. Of course, Jim Chanos of Chanos and Company and Val Zlotev of Analog Century Capital Management. I wanna start just your overall outlook on artificial intelligence and the build out that goes with it. Jim, let's start with you and then Val. Well, as as Rick Reeder said in the in the past previous panel, I mean, it is dominating everything in the financial markets right now. It it's really a unique concept when it comes to particularly the equity market, but increasingly the credit markets as well."
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