Apple was just valued at over 3T. NVIDIA spiked. Infrastructure Bill spending is coming through as I understand it.
We're in a post-vid slump growth phase.
We're in a post-vid slump growth phase.
Nvidia is, as you said, a spike. One driven by AI but will probably be irrelevant in a few years. They're still great at engineering and CUDA will almost certainly continue to dominate, but the AI boom won't last forever. Once ASICs hit the scene it will be game over for GPGPU vendors, like it was with crypto in 2021. They'll still have gaming and industry markets to cater to, but their spiking days are numbered.
So with these recent influx of capital to me that's the market saying that it believes Nvidia and Apple are going to bring in profits in the future so here's money now to grow in order to capture those profits that come in later.
I'm probably misunderstanding aspects here though.
Yes, it's not as simple as "the company will make profits, therefore it's worth a lot".
Apple's expected forward p/e is ~28 over the next five years, which means if you believe that and buy now, you can expect an average return of 3.5%. How much you expect future earnings to grow determines if buying now is a good deal or not.