Good morning, investors. The Nasdaq 100 is up 163% since ChatGPT was released. The last time tech stocks moved this fast, investors were living through the Dot-Com Bubble.
And now everyone wants to know one thing. Is AI another bubble?
Game Over?
This AI Bubble looks different.
During the Dot-Com Bubble, the warning signs were obvious.
In the 5 years before the peak:
Tech stocks: +778%
Forward P/E multiples: +300%
Investors were paying dramatically higher prices for the same earnings.
Today looks different.
Since the AI boom started:
Nasdaq 100: +163%
Forward P/E multiples: -12%
Meaning the rally has mostly been driven by earnings growth expectations (not multiple expansion).
But that creates a different risk.
Forward P/E only works if future earnings actually arrive.
And we see two major issues here:
1. AI spending
Hundreds of billions are flowing into AI infrastructure.
But parts of the AI ecosystem are becoming circular:
Companies invest into AI businesses…
Which then spend that money back into the same ecosystem.
Eventually, real demand needs to replace constant spending.
2. AI monetization
Companies are making one of the biggest technology bets ever.
Now comes the hard part:
Turning AI adoption into real cash.
So we see two possible outcomes here:
Bull case: AI creates enough productivity and earnings growth to justify today’s massive investments.
Bear case: AI spending slows, earnings expectations fall, and today’s “cheap” valuations reset fast.
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2026’s Top Stocks
Investing in 2026 has become an AI infrastructure boom.
Chips. Memory. Storage. Servers. Semiconductor equipment.
Since January, the S&P Global Semiconductor Index is up 118%, while the S&P 500 gained around 10%.
The lesson is an old one:
During gold rushes, the biggest winners are often the companies selling the shovels.
But what we find most surprising…
Many of these winners were “old tech” companies investors ignored just a few years ago.
The Elon Musk Effect
Elon Musk might be the best person in history at selling the future.
SpaceX is now one of the most valuable companies on Earth. But when you compare the numbers…things get interesting.
SpaceX is now worth around $2.0 trillion, making it the 7th largest company.
And it’s trading at 109x sales.
Meanwhile Amazon is worth around $2.5 trillion, making it the 5th largest company.
But Amazon generates hundreds of billions in revenue and trades near 3.4x sales.
Something does not add up.
Is Netflix Cheap?
Netflix is now trading near its lowest P/E ratio in almost 4 years.
But the business itself looks very different.
In the period of 2020-2025:
Netflix earnings per share are up 316%.
Operating income is up 190%.
Yet investors are paying a much lower multiple for those numbers than they did before.
The reason? Competition.
iPhone Prices Up
The AI boom is now affecting iPhone prices.
As AI data centers demand more memory chips, supply is getting tighter and prices are rising.
According to estimates:
iPhone 17 Pro production cost: $582
Estimated iPhone 18 Pro production cost: $726
That’s an extra $144 per phone in cost.
But the expected retail price increase is:
$1,099 → $1,299
That’s an extra $200 per phone in revenue.
Meaning Apple could potentially add $56 in extra profit per device if demand remains strong.
Apple has historically been able to pass higher costs to customers.
And we believe 2026 will be no different.
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