If Artificial Intelligence Is in a Bubble, These Are the Stocks That Could Benefit Most
Investors are already starting to show concerns about AI spending, and these stocks are seeing the benefit.
Overview
Few developments have had as big an effect on the stock market over the last four years as the advancements in artificial intelligence. The promise of productivity improvements from AI has driven significant spending on the technology, including new data centers and equipment to outfit them. However, the market has started to waver in recent weeks, amid fears that all that spending might not pay off in the long run.
Semiconductor stocks are technically in a bear market after falling more than 20% since late June. Hyperscalers are under increasing scrutiny as capital expenditures push free cash flow into negative territory. The results have some investors asking whether artificial intelligence is in a bubble.
Details
If there is an AI bubble, it could lead to further pressure on semiconductor and hyperscaler stocks. One sector that could benefit currently looks extremely cheap, and it's worth buying now regardless of whether there's an AI bubble.
Source
Originally published at www.fool.com.