AI-stock valuations flash warning as cheap multiples may signal demand doubts

Times of India reported that Sevens Report Research founder Tom Essaye warned that relatively cheap valuations for several AI-linked stocks may not be a simple buying opportunity. Citing a Business Insider report, the article says low forward price-to-earnings ratios could reflect market fears that the data-center boom may slow and that expected AI earnings may not arrive. The comparison point was the S&P 500's forward P/E of 21.5, with the article noting that growth stocks usually command richer multiples when investors believe earnings will expand quickly.

Key details: Published June 22, 2026 at 08:38 IST, Sevens Report Research founder Tom Essaye warned that cheap AI-stock valuations may be a dangerous signal, The article said low forward P/E ratios could reflect doubts about data-center demand and future earnings, TOI cited Business Insider and compared the concern with the S&P 500 forward P/E of 21.5.

Why it matters: The AI bubble debate is moving from abstract skepticism to valuation signals, especially around whether data-center spending can support expected earnings.