“AI” Tops “Earnings”

With traders and investors focused on the power of AI, it’s no surprise that corporate executives are willing to tell them what they want to hear.

Mentions of AI have not only surged on earnings calls – they’ve topped the term “earnings” itself:

AI continues to drive the narrative on Wall Street, particularly during earnings calls. (Source: Chartr)

With many tech stocks now spending more than 100% of their free cash flow on AI projects, the fear is things may turn nasty.

The recent rally in AI stocks stoked investors’ concerns that prices for tech stocks had gone higher than earnings from the companies justify.

That the calls are buzzing with questions about productivity gains and overinvestment is a good sign that investors are trying to be realistic about what the tech actually produces.

Are they…? The question remains.

Worst case, management teams feel they need to have a competitive strategy in AI — whether needed or not — just to keep shareholders happy.

~ Addison

P.S. This week in Grey Swan Live!, at 2 p.m. ET/11 a.m. PST, we’ll be joined by our natural-resources specialist, Shad Marquitz, for a prescient look at volatility and opportunity in oil, energy, rare earths and precious metals following the Iran bombing excursion.

With traders and investors focused on the power of AI, it’s no surprise that corporate executives are willing to tell them what they want to hear.

Mentions of AI have not only surged on earnings calls – they’ve topped the term “earnings” itself:

AI continues to drive the narrative on Wall Street, particularly during earnings calls. (Source: Chartr)

With many tech stocks now spending more than 100% of their free cash flow on AI projects, the fear is things may turn nasty.

The recent rally in AI stocks stoked investors’ concerns that prices for tech stocks had gone higher than earnings from the companies justify.

That the calls are buzzing with questions about productivity gains and overinvestment is a good sign that investors are trying to be realistic about what the tech actually produces.

Are they…? The question remains.

Worst case, management teams feel they need to have a competitive strategy in AI — whether needed or not — just to keep shareholders happy.

~ Addison

The market’s headline indexes have held their ground, relatively speaking, among all the Persian Gulf hand-wringing. But it’s worth a closer look at what’s causing this unique setup…

The problems in private credit aren’t going away – they’re compounding. For now, the market is more focused on Iran and oil than private credit. But the trouble compounds.

With the United States conducting what the Pentagon politely calls an “operation” against Iranian military infrastructure, markets have had every reason to be panicky. Instead, the past week delivered something subtler…

Gold has been consolidating after a powerful multiyear rally. Yet with America’s gold reserves equal to only about 3% of federal debt, the metal could still have significant upside ahead.

The market’s headline indexes have held their ground, relatively speaking, among all the Persian Gulf hand-wringing. But it’s worth a closer look at what’s causing this unique setup…

The problems in private credit aren’t going away – they’re compounding. For now, the market is more focused on Iran and oil than private credit. But the trouble compounds.

Gold has been consolidating after a powerful multiyear rally. Yet with America’s gold reserves equal to only about 3% of federal debt, the metal could still have significant upside ahead.