Despite growing concerns around overheating AI trades and a sharp decline in Broadcom Inc. (NASDAQ:AVGO) shares on Thursday, tech investor Dan Niles says semiconductor investors should remain optimistic about the sector's long-term trajectory.
AI And Semiconductor Rally Shows Signs Of Froth, Says Dan Niles
In a post on X on Thursday, Niles said he had become increasingly cautious about the near-term outlook for semiconductor stocks after a rapid run-up pushed valuations and investor enthusiasm to elevated levels.
The veteran investor pointed to the semiconductor index's nearly 95% climb from its March lows through early June and warned that parts of the market had started showing "bubble like behavior."
He highlighted several outsized stock moves as evidence of mounting exuberance, including Micron Technology Inc.'s (NASDAQ:MU) roughly 19% jump following an analyst upgrade, Dell Technologies Inc.'s (NYSE:DELL) 33% post-earnings surge, Hewlett Packard Enterprise Co.'s (NYSE:HPE) 19% rally and Marvell Technology Inc. (NASDAQ:MRVL) sharp rise following comments at Computex.
