To be honest, every time the AI sector gets hyped up and traded back and forth, I feel that instead of guessing who will be the next NVIDIA, it's better to just buy the "shovel sellers."

Applied Materials follows this logic — whether it's TSMC, Samsung, or Intel who wins, the equipment to make chips has to be bought from $Applied Materials(AMAT.US). The fiercer the AI arms race gets, the more their order book fills up.

The stock price has risen from last year's low of $128 to nearly $400 now, tripling in value. Many people think it's too expensive and dare not chase it. But my view is: the AI capital expenditure cycle has just started, and it will still take years for 2nm and GAA processes to be fully rolled out. The visibility of equipment demand is much stronger than that of most tech stocks.

Of course, the risks are real: the valuation isn't cheap, export controls are a potential landmine at any time, and insiders have been reducing their holdings recently.