How to Choose AI Technology Stocks? Understanding Dan Ives's Market Perspective on the Tech Bull Run

American renowned tech bull and Wedbush Securities analyst Dan Ives recently shared his core reasons for long-term optimism towards AI themes during an interview on the “Master Investor Podcast.” He started with his personal investment experience during the 1990s tech bubble, extended to key areas such as AI chips, cloud computing, data centers, and enterprise applications, and further explained his thinking in selecting tech stocks, as well as how to maintain investment discipline and conviction amid market volatility.

From the 1990s to today, why embrace tech and AI stocks

Dan Ives stated that he has been researching tech stocks since the late 1990s, having experienced the dot-com bubble and financial crises. However, he believes that the current transformation brought by AI is different from past speculative bubbles. He describes the current stage of AI development as closer to 1996 rather than 1999, mainly because the proportion of companies truly adopting AI globally remains very low.

He pointed out that currently, only about 3% of US companies are officially on the AI application path. In Europe and Asia (excluding China), widespread adoption has yet to fully commence. Governments and sovereign funds are just beginning to evaluate, and overall, the stage remains very early.

Valuation is not the priority; people and long-term direction are key

Regarding stock selection logic, Dan Ives straightforwardly said that if one only looks at valuation, they might miss all the key growth stocks of the past 20 years. He emphasized that the real focus should be on technological direction, industry structure, and the leadership itself.

He named Elon Musk, Jensen Huang, Su Zifeng, Microsoft CEO Satya Nadella, and Palantir founder Alex Karp. He believes that these companies can withstand market skepticism mainly because their CEOs can make long-term bets at critical moments.

Nvidia remains at the core of the AI revolution, with competitors still catching up

On AI hardware competition, Dan Ives said that the global AI revolution is still dominated by a single key chip supplier—Nvidia. After recent on-site visits to Asian supply chains, he observed that the demand-to-supply ratio for AI chips is as high as 12 to 1, indicating that short-term substitution remains difficult.

He candidly admitted that more competitors will emerge in the future, including Google TPU, AMD, and even domestic Chinese chips. However, in terms of technological maturity and ecosystem, Nvidia still leads by at least 4 to 5 years. He also emphasized that US restrictions on Nvidia’s entry into the Chinese market might accelerate the formation of domestic Chinese alternatives.

AI is not a winner-takes-all; the real explosion is at the application layer

In cloud and model competition, Dan Ives does not believe AI will move toward a single winner. He pointed out that less than 50% of workloads are currently on the cloud, and enterprise AI applications are still in their infancy.

He believes that besides major cloud service providers, the real growth momentum will come from second- and third-tier applications and infrastructure companies, including data analytics, databases, cybersecurity, AI infrastructure, and new cloud services. He estimates that for every $1 a company spends on Nvidia’s AI chips, it will further drive about $8 to $10 in overall tech industry-related expenditure.

Model competition heats up, OpenAI still has a complete AI stack advantage

Regarding large model competition, Dan Ives said that Google’s Gemini has proven to be practically competitive, but this does not mean OpenAI is losing ground. He believes that the AI revolution requires multiple models to coexist, and model prices will rapidly decline over time.

He straightforwardly said that if OpenAI were to go public today, its market value could reach as high as $1 trillion because its layout is not based on a single product but on building a complete AI stack ecosystem, which will be a long-term competition over the next decades.

Data centers will not be oversupplied; AI is just beginning to consume computing power

Addressing the question of “overbuilding data centers,” Dan Ives said he does not believe AI data centers will repeat the fiber-optic oversupply of the 1990s. He pointed out that the number of data centers currently under construction worldwide even exceeds the total of existing operational ones, but future demand will only continue to grow.

He mentioned that the real demand for computing power still lies at the front end—autonomous vehicles, humanoid robots, biomedical, government applications, and enterprise AI. ChatGPT is just the tip of the iceberg.

Apple, Tesla, and TSMC’s different positions in the AI ecosystem

Regarding Apple, Dan Ives believes that although Apple’s pace in AI is relatively slow in the early stages, its over 1.5 billion iPhones and vast ecosystem remain an important foundation for future AI commercialization. He expects Apple to gradually introduce AI subscriptions and AI App Store through partnerships and self-developed models.

Talking about Tesla, he said that Tesla’s greatest asset is still Elon Musk himself, and he believes that autonomous driving and humanoid robots will be Tesla’s most critical growth chapters ever.

As for TSMC, Dan Ives describes it as the heart and lungs of the global AI supply chain. Whether it’s Nvidia, Google, or other AI chips, almost all rely on TSMC’s advanced manufacturing processes. He pointed out that the market has long underestimated TSMC’s strategic position within the entire AI ecosystem.

Retail investors are no longer bystanders; the information gap in the AI era is narrowing

Dan Ives also observed that in recent years, retail investors’ ability to access information has greatly improved, and the gap with institutional investors has significantly narrowed. He pointed out that during some market turbulence, retail investors have chosen to take on positions while institutions retreat, indicating a change in the investment structure.

He believes that even though AI tools enable faster information flow, the real key lies in long-term industry understanding and risk tolerance, not short-term trading.

The AI bull market is not over; stick to your original investment logic

Finally, Dan Ives emphasized that markets will always have noise, corrections, and doubts, but what truly matters is whether one can stick to their original investment discipline and long-term direction amid volatility. He believes that the structural growth brought by AI still has at least several years of development space, and the true inflection point has not yet arrived.

(Goldman Sachs’ latest strong buy list is out: The AI frenzy continues, highlighting Nvidia, Broadcom leading five potential stocks)

This article on how to select AI tech stocks and understand Dan Ives’ market thinking first appeared on Chain News ABMedia.