Microsoft (MSFT) and Nvidia (NVDA) could both hit $4 trillion in market value this summer, Wedbush analyst Dan Ives believes.
Potentially, the “Magnificent Seven” members could reach $5 trillion in over the next 18 months, Ives told clients in a note on Thursday.
“We believe tech stocks will have a very strong second half of the year,” he said. “Our bullish view is that investors are still underestimating the tidal wave of growth on the horizon from the $2 trillion of spending over the next 3 years coming from enterprise and government spending around AI technology and use cases.”
Microsoft and Nvidia recently notched record highs after a rocky first half of the year for stocks more broadly.
Other market watchers are more skeptical about the AI boom.
Legendary short seller Jim Chanos told Bloomberg that the “ecosystem around the AI boom” is similar to the dot-com bubble.
“But it is a riskier revenue stream because if people pull back, they can pull back CapEx very easily. Projects can get put on hold … and that immediately shows up in disappointing revenues and earnings forecast, if it happens,” Chanos said, per the report.
“We’re not there yet, but that’s one of the risks out there that I think a lot of people are underestimating,” he added.