Every major tech trend since the dot-com era has been called a bubble. Every single one.

Our take on the “AI bubble” narrative — and 3 stocks to watch right now

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July 16, 2026 1:01pm EDT

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Dear Fool,

Searches for “AI Bubble” have exploded more than 3,000% recently. The headlines have been relentless: Bloomberg, the LA Times, Wired, MarketWatch — all sounding alarms.

We’ve seen this before. Specifically:

Facebook’s IPO in 2012 was greeted with “Social Media Bubble” headlines across every major outlet. Meta is now worth over US$1.5 trillion.
Cloud computing was called a bubble in 2015. Microsoft’s cloud transformation over the following decade became one of the greatest corporate turnarounds in history.
When ChatGPT launched in November 2022, NVIDIA shares dropped 14% in one month amid bubble warnings. NVIDIA subsequently rose 4,407%.¹

Now consider what the data actually shows:

NVIDIA, the symbol of the AI boom, currently trades at 22.7X² forward earnings — cheaper than the S&P 500 average.
The leading AI memory producer, SK Hynix, with 54%² earnings growth projected for 2026, trades at just 6.3X² forward earnings.
80%² of processors in the largest AI clusters are continuously running. During the dot-com era, fiber utilization was 2.7%.²
Goldman Sachs estimates 90% of AI Factory funding is coming from operating cash flows, not debt. The dot-com era was funded almost entirely by debt.

These aren’t the markers of a bubble. They’re the markers of an opportunity that hasn’t fully been recognized yet.

Which is why we’re making our report “3 to Watch: Intriguing Data Centre Companies We’re Tracking Closely” available to new Stock Advisor Canada members through this campaign. It details three companies our analysts believe are well-positioned for Phase 2 of the AI boom — yours free when you join.

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To your wealth,

¹Returns data from January 3, 2023 to April 16, 2026. ²Market, valuation, and forecast data as of April 16, 2026.

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Every major tech trend since the dot-com era has been called a bubble. Every single one.

Our take on the “AI bubble” narrative — and 3 stocks to watch right now

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