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Tech stock valuations converge with the rest of the S&P 500
Goldman strategist Peter Oppenheimer said derating in dominant tech shares reflects growing worry that AI capital spending may outpace future returns.
Investors are reassessing big US technology valuations, with Goldman strategist Peter Oppenheimer pointing to a shift in how market participants value the largest names versus the rest of the S&P 500, according to Yahoo Finance.
Yahoo Finance reported that the five largest US stocks by market cap, Nvidia, Apple, Alphabet, Microsoft, and Amazon, now trade at price-to-earnings multiples only marginally above the other 495 companies in the index, a sign of “valuation convergence” after the dominant tech group derated.
The outlet also highlighted a separate valuation trend for software, saying the sector’s P/E premium globally has fallen to around 20%, down from near 200% at the start of the century. Oppenheimer attributed the shift to investor anxiety about AI-driven growth, including concerns that AI infrastructure spending is rising faster than the revenue it can produce.
Yahoo Finance added that performance leadership within tech has moved from software toward hardware, with memory and chip stocks benefiting from stronger compute demand and step-ups in earnings growth. The article also noted concerns that some top technology companies are funding large AI spending with debt, adding pressure to the sector’s outlook.
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