Nvidia’s earnings growth signals AI stocks are not in a bubble, says DBS

Every big rally eventually gets asked the same question at dinner parties: is this a bubble? For AI stocks, DBS Group has an answer, and it is a firm no. On October 5, 2026, DBS Chief Investment Officer Hou Wey Fook argued that Nvidia’s earnings trajectory shows AI-related tech stocks have not drifted into bubble territory. His case rests on two figures: a valuation that looks modest and a growth forecast that looks anything but. The numbers behind the call Hou pointed to Nvidia’s 12-month forward price-to-earnings ratio, which he put at approximately 17x. That metric compares a company’s share price with the profits it is expected to earn over the next year. The second pillar is growth. DBS projects Nvidia’s revenue will climb 70% in fiscal 2028, a period that begins in February 2027. That forecast builds on results that were already enormous. In its fiscal second quarter, which ended in July 2026, Nvidia reported $96.2 billion in revenue, up 106% from a year earlier. The data-center segment did most of the heavy lifting, contributing nearly $89 billion of that total. That is the business selling the chips and systems that train and run AI models for the world’s largest tech compa...