Wall Street is worried about the AI ​​bubble, this is the sector where stock prices really stand out

AI boom or AI bubble? This has been one of the most pressing debates on Wall Street recently.

Some investors are seeing echoes of the dot-com bubble in NVDA ( NVDA ) and OpenAI’s recent circular deal-making boom and rising stock prices. Others point out that the AI ​​boom is being funded by hugely profitable technology companies, whose valuations don’t come close to those of their dot-com counterparts.

As Big Tech’s spending on AI swells, so do the ranks of companies clamoring for a piece of the pie. Building AI has upped the sales of unexciting, slow and steady companies and turned their stocks into exhilarating growth names. It has also boosted the stocks of startups that are years away from self-sufficiency, creating pockets of exceptional froth within an expensive AI ecosystem.

To understand where AI trading has become more bubbly, Investopedia It identified 75 companies regularly referred to as “AI beneficiaries” by Wall Street analysts, and classified each into one of five categories: cloud computing providers; semiconductor makers; software companies; energy providers; And makers of networking, storage and refrigeration equipment.

A few companies, like Microsoft (MSFT), fall into multiple categories, and in this case we’ve put them in the most important category for their AI business today. At present, Microsoft’s cloud revenue is the best measure to evaluate its AI business, so it is classified as a cloud provider rather than a software company.

The power supply arrows seem to be the thickest

All five categories have seen their ratings rise over the past few years, but none more so than energy providers. The average price-to-sales (P/S) ratio for our energy basket in 2025 is 4.53, nearly three times the average in 2023 (1.52). The next largest expansions in P/S during that period were networking, storage and cooling (4.45 in 2025 vs. 2.09 in 2023) and cloud providers (10.5 vs. 6.34). (Cloud providers have a higher P/E ratio in absolute terms because the category is made up of technology stocks that have historically received higher valuations. That’s why we compared change over the past three years rather than absolute P/E ratios.)

Power also has more unprofitable companies than any other category – so many of them that we actually use price-to-sales as our benchmark valuation metric rather than the more common price-to-earnings ratio. Five of the 14 companies in our energy basket are expected to report a loss this calendar year. No other category has more than one unprofitable company.

The race to build data centers that train and manage artificial intelligence models has sparked a frantic race to generate and transmit the vast amounts of electricity that these data centers consume. Nuclear power has attracted the attention of technology companies for its efficiency and small carbon footprint. Microsoft, Amazon (AMZN), Alphabet (GOOG), and Meta (META) have all signed multibillion-dollar deals with nuclear power plant operators like Constellation Energy Corp (CEG) and Vistra (VST), both of which have seen their stocks rise over the past two years.

But in the rush to bring reliable sources of electricity online, technology companies and investors have also thrown money at nuclear technology startups, some without operational generators or regulatory approvals. Shares of small modular reactor maker NuScale Power (SMR) more than doubled in value between January and mid-October. At the stock’s peak earlier this month, the company, which reported $37 million in revenue last year and isn’t expected to turn a profit until 2029, was valued at more than $15 billion.

A buoyant stock price without revenue?

Meanwhile, the market cap of nuclear technology startup Oklo (OKLO) peaked at $25.7 billion earlier this month, an increase of 720% from the beginning of the year. Oklo is the only one of the 75 companies we included in our analysis that is expected not to report any revenue this year. Analysts expect it will achieve profits for the first time in 2030.

Although it is not only nuclear companies that have achieved rich valuations. FRMI, developer of a massive AI data center in the Texas Panhandle, was founded in January and went public in early October at a valuation of more than $19 billion. Fermi plans to build 11 gigawatts of computing capacity powered by nuclear, natural gas, wind and solar power generators at the site. It expects to start construction of its first data center in March, and hopes to have about 1 gigawatt of power online by the end of 2026.

Shares of AI energy companies just finished a volatile week that may underscore how susceptible their prices are to volatile sentiment. Constellation Energy and Vistra lost more than 10% of their value in the first half of the week, as did GE Vernova (GEV), whose turbines are in high demand from data center customers seeking to tap abundant natural gas supplies in the South. All three finished the week little changed.

Beginners were hit the hardest. NuScale, Oklo and Fermi lost more than 25% of their value between Monday’s open and Wednesday midday. But they also rebounded, ending the week with losses in the low to moderate levels.