DBS: NVIDIA Valuation Still Low, AI Stocks Far From a Bubble

On October 5, DBS Group Chief Investment Officer Hou Wey Fook stated that NVIDIA's P/E ratio and the projected 70% earnings growth next year indicate that AI-driven tech stocks are far from a bubble. Consolidated data shows NVIDIA's current forward P/E ratio is 17 times. Hou compared this to Cisco Systems' valuation of approximately 100 times before the dot-com bubble burst. In a television interview, he remarked, “If we take NVIDIA as the representative company in the AI space, and its current P/E ratio is only in the double digits, how can anyone call this a bubble?” He added that there remain “tailwinds” for semiconductor and AI investments. Nevertheless, Hou advised adopting a “barbell strategy” to “control overall portfolio volatility,” by allocating tech stocks on the growth end, pairing them with investment-grade fixed-income assets for steady returns, and utilizing hedge funds and gold as intermediate risk diversification tools. (Jin10)