DBS Group Chief Investment Officer Hou Wey Fook said Nvidia Corp.'s current valuation and projected earnings growth show that artificial intelligence-driven technology stocks are not in bubble territory, according to Bloomberg .
According to Bloomberg data, Nvidia's shares are currently priced at 17 times earnings expected over the next 12 months. Hou drew a sharp contrast with Cisco Systems Inc., which traded at 100 times its valuation before the dot-com crash. "If I describe the poster child of AI trading at mid-teens, how can it be a bubble?" he told Bloomberg, adding that there are still "tailwinds to this play on the semiconductor, this play on AI."
Rounding out his case, Hou cited analyst forecasts calling for Nvidia's earnings to expand by roughly 70% in the coming year as additional evidence that the sector has not overextended itself.
Despite his bullish read on AI stocks, Hou said investors should pair technology holdings with investment-grade fixed income, which he said yields above 5% and offers portfolio stability. Hou characterized the framework as a "barbell" meant to "control the overall volatility of the portfolio," with growth-oriented tech on one end, investment-grade bonds on the other, and hedge funds alongside gold occupying the stabilizing middle ground, Bloomberg reported.
Nvidia stock has been trading near its lowest valuation in more than a decade , even as revenue and net income are each expected to grow by roughly 90% or more in the chipmaker's current fiscal year. At under 17 times forward earnings, the stock's multiple has been cut roughly in half compared with 2025 and has fallen from above 25 times expected profits as recently as this past May, according to the outlet. Nvidia Chief Executive Officer Jensen Huang has pushed back on that discount, calling the company "the world's first and only growth value stock" at a Goldman Sachs technology conference.
Nvidia stock closed at an all-time high on Friday for the first time since May, lifting the chipmaker's market value to around $5.7 trillion. The stock is up roughly 27% in 2026. In its most recent quarter, Nvidia reported record revenue of $81.6 billion, up 85% from a year earlier, with data center revenue reaching $75.2 billion, up 92%.
