Earnings support the boom, though financing and data centers are key
Valuations, earnings, and rates will define AI’s next chapter.
The debate over whether AI is a bubble remains open. Capital Group notes that, unlike the dot-com era, earnings at the large AI-exposed companies have grown faster than their market value, and that only about 20% of companies use this technology, according to the Fed. However, local opposition delayed or blocked 75 data centers in Q1 2026, equal to the total for 2025.
The scenarios depend on how easy it is to build capacity and whether the return on investment materializes. With the 10-year Treasury yield above the 5%, financing is more selective and could favor projects that are already well advanced. Current leaders could rotate, and opportunities could broaden to companies that use AI to become more efficient.
AI
Solid fundamentals, but risks to watch.
Earnings support the boom, though financing and data centers are key
Valuations, earnings, and rates will define AI’s next chapter.
The debate over whether AI is a bubble remains open. Capital Group notes that, unlike the dot-com era, earnings at the large AI-exposed companies have grown faster than their market value, and that only about 20% of companies use this technology, according to the Fed. However, local opposition delayed or blocked 75 data centers in Q1 2026, equal to the total for 2025.
The scenarios depend on how easy it is to build capacity and whether the return on investment materializes. With the 10-year Treasury yield above the 5%, financing is more selective and could favor projects that are already well advanced. Current leaders could rotate, and opportunities could broaden to companies that use AI to become more efficient.