--- title: "Nvidia, Micron and Broadcom Already Trade Like Cisco Post Dot-Com Burst: Bank of America" type: "News" locale: "en" url: "https://longbridge.com/en/news/302125151.md" description: "Bank of America analyst Vivek Arya warns that Nvidia, Broadcom, and Micron trade at post-crash valuations similar to Cisco after the dot-com bubble burst. While chip stocks face bear market conditions due to inflation fears and Chinese competition, Arya argues AI demand remains strong with near-full utilization. He identifies risks in neocloud debt and interest rates but maintains a bullish outlook on Nvidia as the primary beneficiary of sustained AI infrastructure spending." datetime: "2026-10-16T15:07:26.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/302125151.md) - [en](https://longbridge.com/en/news/302125151.md) - [zh-HK](https://longbridge.com/zh-HK/news/302125151.md) generator: "portal-rs" --- # Nvidia, Micron and Broadcom Already Trade Like Cisco Post Dot-Com Burst: Bank of America Chip stocks just had their worst week in months, and Wall Street is asking whether the artificial-intelligence bubble is finally bursting. A Bank of America analyst says the question comes too late. On valuations, the burst has already happened. **Vivek Arya** told clients in a note dated Friday that **Nvidia Corp.** (NASDAQ:NVDA), **Broadcom Inc.** (NASDAQ:AVGO) and **Micron Technology Inc.** (NASDAQ:MU) trade at about 13 times forward earnings on average. That sits inside the 10-to-20 times range at which **Cisco Systems Inc.** (NASDAQ:CSCO) traded after the dot-com bubble burst. "Investors are paying post-crash multiples for a cycle that hasn’t crashed," Arya said. ## The Chip Sector Is Already In A Bear Market The Philadelphia Semiconductor Index (SOX), which tracks the 30 largest U.S.-listed chip stocks, was down about 9% for the week by Friday morning and on track for an eighth straight daily decline. The index — closely tracked by the **Invesco PHLX Semiconductor ETF** (NASDAQ:SOXQ) — now sits about 22% below its June 22 record close. A 20% drop from a peak is the usual definition of a bear market. It is the second one this year. Between June 22 and July 29, the index lost 28.6% before rallying back. Memory stocks took the heaviest hit. Micron fell 13.1% this week to around $894, after closing at a record $1,088 on Oct. 7. Broadcom lost 6.5% and Nvidia 5.7%, while the S&P 500 slipped just 0.8%. The selling started with memory. Early in the week, Chinese memory maker CXMT announced plans for a server-memory product built on a new architecture that could pack in more storage, raising concerns that it could take market share from Samsung, SK Hynix, and Micron. Then inflation joined in. A hotter-than-expected inflation reading on Wednesday revived worries about further Federal Reserve rate hikes and a higher cost of capital for the AI trade. Collectively, 20 of the world’s most valuable AI and semiconductor stocks shed more than $1 trillion in market value through Thursday. **Read Also: Chip Meltdown Hits Micron, SanDisk and SK Hynix: $1 Trillion Vanishes From Memory Makers** ## **This Is Not 2000**, According to Bank of America The dot-com bust left miles of fiber-optic cable unused, known as "dark fiber." Arya says AI hardware is the opposite. It runs near 100% utilization, and rental prices for older Nvidia chips launched between 2020 and 2024 are up 12% to 37% this year. Rising prices for old equipment point to scarcity, not a glut. Demand keeps climbing. Weekly usage on OpenRouter, a platform that routes requests to AI models, hit about 170 trillion tokens in early October, up from roughly 3 trillion a year ago. A token is a small chunk of text an AI model reads or writes. Arya sees agentic AI, software that completes multi-step tasks on its own, as the next tenfold jump in computing demand. ## **Nvidia Is Bank of America’s Gigawatt Winner** With power and land now scarcer than chips, Arya expects spending to favor the most productive hardware. He argues that Nvidia captures more than 70% of AI system spending, backed by over $100 billion in announced buybacks. Cloud and neocloud capital spending is expected to reach about $1.01 trillion in 2026, up 98%, and $1.39 trillion in 2027, up 37%. Arya named three: a credit event at a neocloud, higher interest rates, and delays in power and permitting. Neoclouds, such as **CoreWeave** Inc. (NASDAQ:CRWV) and **Nebius** **Group N.V.** (NASDAQ:NBIS), rent out AI computing capacity, often funded with debt. The cash math is stretched. Big cloud companies are expected to spend about 106.5% of their operating cash flow on capital projects in 2026. The bank still sees that as sustainable, since the top five hyperscalers have raised about $382 billion this year, mostly in long-dated debt and equity. Cisco shows how long a reset can last. Its stock peaked at $82 in March 2000, fell to $8.12 by October 2002, and didn’t reach that peak again until March 2026. 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