Nvidia And Other High-Flying AI Stocks Face Risk Of Falling Off A Cliff Over The Next Year? Tech Strategist Flags 'Not-So-Hidden' Costs That Market Is Not Factoring In
Portfolio Pulse from Shanthi Rexaline
Barclays analysts warn that AI companies, including Nvidia, Alphabet, Meta, and Amazon, face significant depreciation costs that are not fully factored into current valuations. This could lead to a decline in stock prices over the next year. The Global X Artificial Intelligence & Technology ETF (AIQ) also saw a slight decline.
August 13, 2024 | 8:57 am
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NEGATIVE IMPACT
The Global X Artificial Intelligence & Technology ETF saw a slight decline, potentially impacted by concerns over AI companies' depreciation costs.
Concerns over high depreciation costs for major AI companies could negatively impact the ETF's performance.
CONFIDENCE 75
IMPORTANCE 70
RELEVANCE 60
NEGATIVE IMPACT
Amazon faces higher-than-expected depreciation costs, which could lead to a stock price decline.
Barclays estimates Amazon's depreciation costs to be significantly higher than consensus, which could lead to a downward adjustment in stock price.
CONFIDENCE 80
IMPORTANCE 85
RELEVANCE 80
NEGATIVE IMPACT
Alphabet faces higher-than-expected depreciation costs, which could lead to a stock price decline.
Barclays estimates Alphabet's depreciation costs to be significantly higher than consensus, which could lead to a downward adjustment in stock price.
CONFIDENCE 80
IMPORTANCE 85
RELEVANCE 80
NEGATIVE IMPACT
Alphabet faces higher-than-expected depreciation costs, which could lead to a stock price decline.
Barclays estimates Alphabet's depreciation costs to be significantly higher than consensus, which could lead to a downward adjustment in stock price.
CONFIDENCE 80
IMPORTANCE 85
RELEVANCE 80
NEGATIVE IMPACT
Meta Platforms faces higher-than-expected depreciation costs, which could lead to a stock price decline.
Barclays estimates Meta's depreciation costs to be significantly higher than consensus, which could lead to a downward adjustment in stock price.
CONFIDENCE 80
IMPORTANCE 85
RELEVANCE 80
NEGATIVE IMPACT
Nvidia's aggressive design cycle and high depreciation costs could negatively impact its stock price over the next year.
Nvidia's frequent product releases lead to higher depreciation costs, which are not fully accounted for in current valuations. This could result in a downward adjustment in stock price.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 100