Jefferies warns AI stocks' earnings growth will sharply slow
Business
Jefferies says the wild earnings growth of AI stocks is about to slow down, a lot.
After surging nearly 100% in 2026, growth is expected to drop to just 30% in 2027 and 22% in 2028.
This has some people wondering if these high-priced AI stocks are really worth it going forward.
Jefferies flags 23x AI, recommends non-AI
Jefferies also points out that AI stocks are much pricier than others right now, trading at a big premium (23 times future earnings versus just 13 times for non-AI).
Their advice? It might be time to look beyond the hype and consider non-AI sectors, especially in emerging markets where returns have been solid lately.