Key insights
- An analysis of 40 large-cap companies tied to AI capital spending reveals that 73% have underperformed the S&P 500 YTD. Power and cooling companies like Vistra and Eaton show multiple expansion exceeding revenue guidance. Excluding NVDA and AVGO, semiconductor stocks are flat. Even cloud hyperscalers like AMZN and GOOG have lagged. This suggests caution regarding the current AI investment hype and its immediate impact on equity performance.
Screened 40 large caps most tied to AI capital spending and 73% have trailed the S&P YTD by a median of about 9 points. Power and cooling names diverged the most. Vistra trades at 42x forward now versus 28x a year ago but is only up 4% while the index sits around 13%. Eaton and Vertiv show a similar pattern: multiple expansion running well ahead of actual revenue guidance upgrades.
Semis look better on the surface but strip out NVDA and AVGO and the remaining group (MRVL, INTC, MU, KLAC) is basically flat. What surprises me is that even the cloud hyperscalers, AMZN and GOOG included, have quietly lagged despite being the ones writing the capex checks.
Compiled the screen by pulling filings and returns through MuleRun then verified manually. Five month window on 40 names, so a snapshot, not a thesis.