Could AI Lift All Boats? Top Wall Street Bank Predicts Potential 14% Rise in S&P 500 Fair Value, Flags Risks Over NVIDIA's Dot-Com-Like Valuations
Portfolio Pulse from Piero Cingari
Goldman Sachs predicts that widespread adoption of AI could boost productivity growth by 1.5 percentage points per year, leading to a 5-14% rise in S&P 500 fair value. However, the bank warns of risks associated with high valuations of companies like NVIDIA Corporation.
June 07, 2023 | 4:29 pm
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Goldman Sachs warns of risks associated with NVIDIA's high valuations, comparing them to dot-com-like expensiveness, which could lead to market setbacks.
Goldman Sachs' comparison of NVIDIA's high valuations to the dot-com era suggests that the company's stock price may be overvalued and could face a correction. The dot-com bubble led to a sharp decline in share prices, and a similar situation could occur with NVIDIA if the market perceives its valuation as unsustainable.
CONFIDENCE 85
IMPORTANCE 70
RELEVANCE 80