AI stock pickers just got an important reminder

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AI stock pickers just got an important reminder

watchlist :: 2025-09-28 :: source - yahoo finance

By Brian Sozzi

This is The Takeaway from today's Morning Brief, which you can sign up to receive in your inbox every morning along with:

What we're watching
What we're reading
Economic data releases and earnings

This has been a week of reminders for investors. There are so many to choose from, I almost don't know where to begin.

First, this is an Nvidia (NVDA) market. It's a market that will work for the bulls for as long as Nvidia works. If Nvidia is going to chart a course for AI domination, as seen in its new $100 billion OpenAI (OPAI.PVT) deal on Monday, and the stock gets pushed higher, it's bullish for the broader market.

"I think AI is a real thing," Robinhood chief investment officer Stephanie Guild said on Opening Bid (video above). "I still think there's a lot of growth in this country. And you're starting to see it in other sectors, ... in aerospace and defense, for example. So I definitely think it's something you have to pay attention to. You have to kind of be invested in whether it's Nvidia or in other kinds of smaller players that benefit."

Second, if you're a CEO who ignores the retail investor, you do so at your own risk and general foolishness.

Opendoor (OPEN) and now Better Home & Finance (BETR) continue to see wild moves for the simple reason that a hedge fund manager is making strong bullish cases on X.

I have known that hedge fund manager, Eric Jackson, for more than a decade; I used to edit his columns at TheStreet. I am not surprised he has gained a stock-moving following. He puts in the hard work to find undervalued names.

Jackson shared more about his views on Opendoor during his last appearance on Opening Bid — it's worth a watch.

Lastly, if you're a bear, it will be hard to stay that way as long as the Fed is cutting rates. I think Monday's commentary from new Fed member Stephen Miran on the need for a series of rate cuts is where policy may be headed. This could keep a strong buy-the-dip mentality in markets.

A trader works on the floor of the New York Stock Exchange (NYSE) in New York City as a screen broadcasts a news conference by Federal Reserve Chair Jerome Powell following the Fed rate announcement on Sept. 17. (Reuters/Brendan McDermid/File Photo). Reuters / Reuters

Having said that, I want to get back to the AI trade.

For the better part of the summer, a black cloud was hanging over this trade, and there was a constant fear that the artificial intelligence buildup was nearing a peak. Suddenly, Wall Street profit estimates for AI companies were deemed too high, valuation multiples too lofty, and sentiment as euphoric as that first sip of coffee at work in the morning.

This entire thesis was proven to be trash throughout the summer, and even more so right now.

Besides the Nvidia-OpenAI tie-up, consider the new information we got on AI within the past week:

Alibaba (BABA) said it would spend more than $50 billion to build out AI models over the next three years. It was only in February when it gave that initial $50 billion figure.
Micron (MU) dropped this comment on its earnings call: "In terms of the demand profile and what is shaping up looking ahead, certainly, the large hyperscalers are looking like they will be needing significantly more storage capability for their AI server deployment because they have shortages on that side from the HDD segment of the market. And so the deployment of NAND SSDs and servers and data centers more broadly is going to increase in calendar 2026. So we expect, driven by that tailwind, for the NAND industry conditions to start improving."
Up-and-coming Nvidia rival Groq (GROQ.PVT) just raised $750 million at a post-money valuation of $6.9 billion. Groq CEO Jonathan Ross recently hopped on my Opening Bid Unfiltered podcast — this one is also worth a watch.

So let's put to bed the view that artificial intelligence is peaking.

AI stock pickers, you have the reminders you need to make informed bullish bets on this powerful technological trend. I wish you well.

Programming note

I'm headed to Detroit this week and will be live on air from Ford's (F) industrial conference on Tuesday. I have some fabulous C-suite interviews lined up, all of which aim to get a sense of the industrial economy amid the Trump administration's actions to reorder global trade. Tune in Tuesday morning on Yahoo Finance.

Separately, Monday's Opening Bid Unfiltered podcast drop is with BlackRock's Gargi Chaudhuri. She is one of my favorite Wall Street strategists, and her latest thoughts on markets will get your week started right. The latest episode hits at 8:30 a.m. ET.

Brian Sozzi is Yahoo Finance's Executive Editor and a member of Yahoo Finance's editorial leadership team. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email brian.sozzi@yahoofinance.com.