AI innovation just starting, says Wedbush analyst, highlighting Nvidia’s growth and Taiwan Semi’s future role in semiconductors
Amidst discussions of an AI bubble, Matt Bryson argues that there isn’t one. He believes the AI journey is just beginning, despite market volatility and potential spending slowdowns. Bryson highlights the significant amount of money available in the industry, suggesting that current valuations are not overpriced.
Matt Bryson, Managing Director and Analyst at Wedbush Securities, argues that companies like Nvidia and Taiwan Semiconductor are trading at close to 10 times 2028 numbers, yet they are growing at rates of 40-50% annually.
He believes these companies’ valuations will eventually look cheap as the demand for semiconductors and GPUs to support AI increases.
I don’t think there’s an AI bubble. We’re at the very beginning of the AI journey.
Matt Bryson, Managing Director and Analyst, Wedbush Securities
Tech valuations and future growth
Bryson points out that if a slowdown occurs, the perception of these valuations could change. However, he remains optimistic, noting that Taiwan Semiconductor will continue to be a primary engine for the semiconductor industry over the next few years.
He also mentions that Nvidia is poised for significant growth, potentially increasing by 70% next year.
On the topic of Jensen Huang’s recent controversy, Bryson does not believe it will lead to Huang’s removal from Nvidia.
He suggests that the situation is unlikely to affect the company’s operations significantly. Bryson emphasizes that Nvidia remains a leader in the AI chip market.
Regarding Intel and AMD, Bryson notes a divergence in their recent performances. AMD has consistently executed well under Lisa Su, while Intel has struggled with execution and financials.
Bryson sees potential for Intel if they can improve their execution, as there is a strong demand for compute.
Looking ahead, Bryson foresees a tight memory market over the next several quarters, with companies making substantial profits. He advises that current valuations make it worthwhile to invest, although the easy money may have already been made.
In conclusion, Bryson remains bullish on the semiconductor industry, particularly on companies like Taiwan Semiconductor and Nvidia, which he believes will continue to thrive as AI technology evolves.
