AI Capex Outpacing Revenue Returns
Wall Street is overestimating company earnings, leading to inflated valuations in the Nasdaq 100.
Too little corroboration in the last 3 days to call a trend (3 articles). Watching for it to gain traction.
Mainstream financial press is carrying this — attention has broadened beyond specialist outlets.
"The tech-heavy indices were led lower by Tesla and Alphabet. Tesla shares fell 14.5% to close at their lowest level since March 2025, while Alphabet, the Google-parent, fell 7%. Both stocks fell after their respective earnings failed to cheer the street. Together, big tech wiped out nearly $767 billion in market capitalisation on Thursday."
""Everyone's lining up to tell you to buy the craziest IPO in the history of man," Grantham told Morningstar's "The Long View" podcast. "In 50 years, they'll be telling and writing stories about SpaceX, and they'll be quoting you paragraphs from the prospectus, and you will be laughing at it.""
"He said the Nasdaq 100, by his reckoning, is trading at 43 times earnings — well above the implied level of around 30 times — because 'Wall Street may be overstating by more than 50% the earnings at our fastest growing, most highly valued companies.'"