Analyst Warns Low P/E for AI Stocks NVDA, MU Signals Bubble Risk

Tom Essaye, founder of Sevens Report Research, warns that surprisingly low price-to-earnings (P/E) ratios for some high-growth AI stocks signal investor doubt about future profitability, potentially mirroring the 2000 dot-com bust. Essaye stated on June 21, 2026, that these valuations suggest concerns about a potential slowdown in data center build-out, which could severely impact the AI supply chain. Essaye highlights NVIDIA (NVDA) with a 21x forward P/E despite a 44% gain over 12 months, and Micron Technology (MU) at 10x P/E after a 770% surge. Broadcom (AVGO) trades at 24x P/E with a 51% gain, and SanDisk (SNDKV) at 14x P/E after a 4,490% rise. These compare to the S&P 500's 21.5x P/E. Oracle (ORCL) shares have fallen approximately 25% since June 1, 2026, amid heavy AI infrastructure spending. Essaye cautions that if AI's practical benefits lag expectations, corporate investment could retract, leading to significant order cancellations for chip and equipment suppliers.