Nvidia will be the ‘grand marshal’ of the A.I. bubble ‘parade,’ says Josh Brown
A scarcity of artificial intelligence plays is causing an AI bubble, with Nvidia leading the charge, said Ritholtz Wealth Management CEO Josh Brown on Tuesday. Shares of Nvidia are up nearly 80% so far this year as investors hop into the AI theme. “Nvidia is going to be the grand marshal of that parade, twirling the baton down Main Street,” Brown said on CNBC’s ” Halftime Report .” “That is going to be an all year story.” The company recently unveiled new products at partnerships at its developer conference and launched its DGX Cloud, which can be used to train models behind generative AI applications. Wall Street analysts hailed Nvidia’s dominant leadership in AI after the company’s conference. One of those analysts, Bank of America’s Vivek Arya, wrote in a note afterwards that Nvidia’s dominance in generative AI and the large language model could “reshape the existing tech industry.” NVDA YTD mountain Nvidia’s year-to-date performance The issue right now for investors is that there are not enough AI plays in the stock market to meet demand, Brown said. “You are going to see valuations in a small handful of AI stocks that are … going to give you vertigo,” he said. However, the scarcity won’t last. Initial public offerings are already being put together, he said. “Funds, products, IPOs and strategies are being formulated in the dozens as we speak. This will hit the hundreds before we’re through. It’s merely stage one,” Brown wrote in a February blog post . On Tuesday, he predicted that when the IPOs start it will be “insanity 2021 style.” “Until that happens, you won’t have a lot of choices,” he said. For those who want to be in AI, Nvidia is the biggest way to do it, Brown said. –CNBC’s Sarah Min and Michael Bloom contributed reporting.