AI Stocks Soar on Promise and Hype of Generative AI
• AI stock prices surged in 2023 fueled by high expectations of generative AI's potential, leading to expanded P/E ratios • The AI boom is real with evidence like chip shortages and tech companies rapidly investing, but some stock gains seem hype-driven • In 2024, there will likely be a bifurcation between real AI winner stocks and pretenders as investors become more discerning • Semiconductor companies like Nvidia, AMD, and Broadcom are poised to capitalize on AI infrastructure needs in the near term • Over the long term, big tech companies like Microsoft, Alphabet, and others have potential to turn AI into meaningful businesses, but it will take patience