Let’s face it, the air is getting thin at the top of the AI mountain. Nvidia, the undisputed king of the AI chip sector, got a harsh reality check this past week, with a record $279 billion wiped off its market cap in a single day. Are investors finally waking up to the fact that this AI darling is priced for perfection… perfection that might be impossible to achieve?
While the talking heads on CNBC are busy trying to explain away Nvidia’s woes, I’m going against the herd, taking a page from one of Wall Street’s top contrarian investors.
Eric Fry
Eric Fry, editor of Fry’s Investment Report, has a knack for finding opportunities where others only see danger. He’s been sounding the alarm on Nvidia for months now, arguing that investors are too focused on the hype and overlooking other, more promising opportunities in AI.
In his August 29 article, “Nvidia Beats, but I’m Still Looking Elsewhere“, he wrote:
“Companies as dominant as Nvidia often gain lofty valuations, and they can maintain those valuations for what seems like forever. That said, Nvidia will have to continuously achieve nearly miraculous results to validate and/or expand its valuation.”
Fry is right. Even with its blowout earnings, Nvidia will have to continuously grow revenue by triple digits just to maintain its current valuation.
That’s where our Contrarian AI play comes in…
[Redacted Company Name]
Eric Fry specifically points to a company in his portfolio that’s up nearly 30% since February, even though five out of seven analysts covering the stock rate it a “Sell” or “Hold.”
Most folks in finance don’t even know this company exists. But it’s quietly applying AI to tackle one of the biggest challenges in healthcare. While I can’t publicly reveal this pick (that wouldn’t be fair to Eric’s subscribers!), I can point you in the right direction…
Click here to learn how to access this pick and many more inside Fry’s Investment Report.
I hope you found this valuable. We’ll be back tomorrow with another exciting watchlist idea. This time, we’ll be looking at stocks that are set to explode… regardless of if the Fed cuts interest rates.
See you then!