Chapter 1: What factors are contributing to the recent Nasdaq surge?
I'll offer this now, okay, as a counter to a dot-com comparison. C3 AI, it's got the ticker AI. Yep. How would you feel that company has done so far in 2026? Oh, interesting. Under this complete like AI trade, one of the strongest momentum things we've seen in the markets, maybe since post-COVID, like that software rush, but maybe even stronger. How do you think that company is?
The obvious answer is it's been on a bull run because it's the AI supercharge. I'm going to suspect, It dropped a bit.
They're down 35% year-to-date and 93% since IPO in 2021. Those five years on the public markets have encapsulated the AI bulrush.
welcome to stock club the podcast where we find and discuss stocks that anyone can buy many of which we believe will go on to grow your wealth i'm joined by my colleague and friend michael matney how you doing mike i'm great now yeah tipping away I see David Attenborough turned 100 years old last week, which was certainly a birthday of note. Did news of it hit your shores in Biarritz in France?
Chapter 2: How do current semiconductor stocks compare to historical bubbles?
I did. I saw a beautiful kind of compilation of all his old bits and his commentary and stuff. But I was reminded someone very wise told me just today, actually, that They did a survey in the UK and something like 3% of people said that they hated David Attenborough. Yeah.
And that's a testament to just whatever you do, wherever you go, there's always someone that's going to disagree with you because how could you hate David Attenborough?
I totally agree. I think I took a degree of comfort from that, that if you're in the public eye, no matter how small that eye is, and I think you and I, Mike, to a degree, are in the public eye, there's always going to be someone who just hates your guts. And that's just the way it goes. I mean, who could hate David Attenborough? I remember watching his shows with my grandfather. Poachers, maybe.
Maybe 3% of the UK population are poachers. Well, that's a good point. Down with rainforests, that kind of stuff.
Chapter 3: What evidence supports the argument against an AI bubble?
Exactly.
anyway happy david happy birthday david i'm sure you listen to stock club so we wish you all the best for the next 100 years mike the question the real question i have for you is are we in a bubble the nasdaq is up something like 27
in five weeks so we're recording tuesday 12th of may uh before the market opens but right now the market is up a whopping 27 in just little over a month are we in a bubble do you think it's a good question and like first of all this isn't a normal market whether we decide if it's a bubble or not like that's a maybe another question but
Six weeks ago, we were here and we were going to hell in a handbasket. Do you know what I mean? The S&P was down 8%. I think the Nasdaq was in correction territory. We were staring down the war in Iran, the uncertainty around energy prices, none of which have gone away. Oil futures were spiking.
there was very much a sense of fear in investing circles and then as you said six weeks later the nasdaq turned around 28 i think the s p is up 17 since that march low it's up eight percent year to date the nasdaq is up 16 year to date which is incredible it kind of reminds me a small bit of this about the same time last year when we had liberation day and the whole world exploded uh for about a month six weeks and then everyone was like actually
Wait a minute. That's not actually too bad. But just this seems to be happening again and again and again. It happened after COVID. It happened after Liberation Day.
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Chapter 4: Which undervalued stocks are being overlooked in the current market?
It happened with the war on Iran concern as well. The speed of recovery is just beyond belief. And it is a fair question. Like, you know, are we in a bubble? Is this a melt up?
is is irrational exuberance in the mix because it's just it is not a normal market right now i'm still in this stat actually i saw it from uh charlie bellello who's a good uh follow on twitter so the 16 gain in the s p 500 over the last six weeks is the 11th biggest six-week gain for the index since 1950 which is you know impressive but nothing yeah
truly out of the ordinary, just a very strong period. But what's unique about this rally is it's the only example in the top 20 that did not occur either during a bear market or soon after a bear market low. So I think this market is moving so fast that whatever downturn caused from the Iran war and the energy crisis was viewed in such a sense as, okay, that's our bear market. Now we recover.
Now we bounce back from whatever it was, an 8% loss from the year.
Yeah. I mean, I got a kick out of you calling it a melt up as opposed to a meltdown. I'm still smiling at that because Bank of America, I was reading during the week, described it as an upside crash. And I never heard of a melt up or an upside crash, but that kind of captures the mood of market watchers and measures and statistics like that.
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Chapter 5: What are the implications of GameStop's bid for eBay?
And interestingly to me, but not shockingly, the semiconductor sector is where the extremes are the most vivid.
100%. It's the same old names, just going absolutely parabolic.
Did you know there's a Philadelphia Semiconductor Index? Did you ever hear of it?
No.
It's known, neither did I before I researched this, by the way, but it's known as SOX, S-O-X. And it was up... nearly 40% in the single month of April, and it's up 160% year on year, which kind of gives a very good macro view of what a profound impact the semiconductor market has had on the overall market. And these numbers, whether you're up 40% in April or 160% year on year, are so extreme.
They are the most extreme for that index since the year 2000, and that comparison Any mention of the year 2000 will make anybody my own age or like you well-read on the market sit up straight because we don't like year 2000. It was the dot-com bubble.
And someone put the performance of the top 10 stocks.
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Chapter 6: How is AI spending impacting company earnings and valuations?
So from 12 months previous to the dot-com peak, Interestingly, there was two stocks that are in both Sandisk and Lemare Corp. But the top ten stocks of the last twelve months actually performed better than the top ten stocks from the twelve months before the dot com peak, which is worrying. And it is the same old names popping up. So you have Intel, this is recorded on Tuesday.
Intel has doubled in a month. It's up 500% in 12 months. You are kidding me. SanDisk, we talked about SanDisk on the podcast in December.
It ranked number one on something we were talking about.
It was the top performance stock from 2025.
Right.
And that wasn't even a full 12 months because it had a spin off from Western Digital within that year. But it's just gone absolutely haywire.
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Chapter 7: What are the risks of investing in high-flying AI stocks?
It's up, at time of recording, 63% in a month. 450% in six months, 600% since we talked about it on the podcast and we were saying the run-up was crazy then and about 37 or 3,800% in the last 12 months.
Just nuts. Do you remember David Gardner was on the podcast? He said, what goes up must go upper. Well, that's the perfect example. I mean, it's up 600% since we were kind of lampooning its, its meteoric rise in the preceding months.
100%. It's the same old names. It's in memory. Micron, my old flower, my horn in my side. Every time I check the markets, it's up 86% in a month, like eightfold in the last year. Western Digital is similar. 1000% in the last year. It's amazing.
Chapter 8: What should investors consider when navigating potential market bubbles?
200% since we're talking about in the podcast, which looks paltry compared to Sandisk. And then Axt. Have you heard of this business?
I've heard of AXD. Yeah.
Yeah. So same old, like 40 year old chip company makes wafers for semiconductors. All of a sudden it's up 700% so far this year, leading the kind of charge when it comes to semiconductors.
Well, there you go. I never would have guessed it. Michael Burry, you know, the big short movie, like he's characterized the current NASDAQ rally as more extreme than 1999.
I will push back on that slightly. And in fairness, now Michael Burry has predicted 20 of the last three recessions. So to him and Ray Dalio, like to everything, what's the phrase? Sorry, I'm going to get this wrong. To a hammer, everything looks like a nail.
Yes. Yeah.
So obviously there is such hype on momentum here. It's undeniable and it is exuberant. But there is some fundamentals underpinning that as well. We're just out of an incredible earnings season. So the median earnings surprise, aka companies outperforming estimates of 6% this earnings season, which is the best it's been since 2022.
And the bottom line coming out of the earnings season is that, at least for now, the perception is AI spending is not slowing down in any way. We saw that with the hyperscalers earnings. They're all committed to spending more this year and even more in 2027. And the companies lined up to serve those markets are the ones leading this charge.
The demand has never been hotter, which is crazy to say because it feels like we're talking about the same topic for the last two years, really. But it isn't a baseless rally. The underlying metrics are there. And obviously the collective psychology is there too. It's definitely shifted to a risk on mentality and maybe a herd mentality. But there are fundamentals at play too.
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