It All Could Come Down To Depreciation

A recent article on Seeking Alpha argues that the meteoric rise of AI‑driven stocks may be hiding a serious risk: depreciation. The so-called “AI Revolution” has boosted major names such as NVIDIA and others — pushing the overall market into what some see as overbought territory. But the author warns there are two underappreciated downsides. First, heavy investment in AI infrastructure means firms must eventually account for depreciation of expensive hardware and other capital equipment — a cost that could weigh on future earnings, even if revenues stay high. Second: many of the rosy scenarios priced into today’s valuations assume continued growth without factoring in how quickly costly assets lose value. If depreciation pressures mount, companies may struggle to justify current high stock prices — especially if demand slows or competition intensifies. In short: while AI has powered recent market gains, depreciation might be the weak link that could bring the rally back down to earth. #AIinvestment #DepreciationRisk #TechBubble #MarketValuation #SlimScan #GrowthStocks #CANSLIM