Q: In the case of a recession confirmed during the next 12-18 month how do you anticipate the impact on the ai sector and specifically on these stocks?
Thank you very much in advance
Thank you very much in advance
5i Research Answer:
Much will depend on what causes the recession. If there is stagflation we would expect a much harsher reaction. If it is simply an earnings slowdown it may be less impactful. Interest rates also come into play. Higher interest rates (they are expected to fall) would be very tough for expensive stocks such as PLTR. CLS and NVDA are much more reasonably priced and might not get hit so hard. But in a recession or market setback sentiment changes and so will valuations. NVDA/CLS might see a 20% correction, PLTR could see more.
Authors of this answer, directors, partners and/or officers of 5i Research and/or affiliated companies have a financial or other interest in NVDA, PLTR.