Goldman Sachs: AI Risks Intensify Debate Over Stock Valuations

Reported by Jinse Finance, on April 28, strategists at Goldman Sachs stated that disruptive risks brought by artificial intelligence (AI) are intensifying market debates over stock valuations. The team led by Ryan Hammond noted: "The perceived threat of AI disruption is causing investors to focus more on the 'terminal value' of many stocks." Their analysis, based on a 10-year dividend discount model, revealed that "the terminal value of the S&P 500 Index currently accounts for approximately 75% of its overall equity value, nearing the highest level in the past 25 years." The strategists specifically highlighted the recent underperformance of software stocks and other "light asset" industries. "For stocks whose value is highly concentrated in the distant future, the sharp decline in recent stock prices contrasts sharply with resilient short-term earnings, further underscoring the importance of long-term growth prospects." (Dongxin News Agency)