A Goldman Sachs trader gives 3 reasons he thinks AI stocks are not in a bubble

Core Insights - The term "bubble" is being frequently mentioned in the context of AI stocks, but a Goldman Sachs trader argues that the current market conditions do not indicate a bubble [3][4]. Valuation - The current valuation of leading companies is based on strong fundamentals, with the two-year forward P/E ratio of the top seven stocks in the S&P 500 at 27, significantly lower than the 52 seen during the dot-com bubble [5]. Fund Flow - Goldman Sachs projects that households will invest approximately $520 billion in US stocks in 2026, representing a 19% increase from the previous year. Additionally, there has been substantial foreign investment in US markets due to the dollar's depreciation and interest in AI stocks [6]. Consumer Resilience - The consumer market is increasingly resilient, contributing to the stability and growth of AI-related stocks, which further supports the argument against the existence of a bubble [7].