Beware the excitement

According to Warren Buffett: “Investors should remember that excitement and expenses are their enemies.” For AI, you have the kind of excitement currently that may well end at a heavy cost for some investors. Example NVIDIA: the company is a clear winner of AI but its stock price is now supercharged. The stock is up 192% this year alone and 544% over 5 years. It trades at 140 times trailing earnings, 41 times revenues, 43 times book value and carries a dividend yield of 0.04%. For us it is hard to justify this type of “excitement” in our client portfolios.