Bokeh Capital’s Kim Forrest: Slowdown in Gen AI data centers coming, and won't be pleasant

The IPO market may be opening up, as Bob points out, but our next guest says tread carefully because investing in tech with an AI only strategy will be risky. Instead, she’s sticking with a broader stock play as earnings season gets underway. Joining us now, Kim Forrest, Chief Investment Officer at Boca Capital Partners. Why are you wary of AI Kim? Well, it’s been about a year since the AI Rocket took off and I’m sure everybody that owned NVIDIA at that time, or maybe bought it subsequently is super happy about that. But I do have a warning, having been in the world of technology and certainly having watched it since I became a sell side analyst first job in this industry in 1999, not all stocks go to Infinity and beyond, they just don’t. And generally whenever a technology is being rolled out or developed, there are pauses in spending and I think a pause in spending. And I I do believe in the long term you know viability of AI certainly but a short term slowdown might make investors lose their minds and start selling a lot. So that’s my warning to you. And the warning then is if these stocks go down, don’t panic and sell or what, make sure I understand. You are always supposed to be looking at what is in your portfolio, right? And if you only have AI focused stocks, I think it would be time right now to take a look and broaden out and think a little differently and hedge your bets, take some money off the table and apply it somewhere else. But I do think that you can certainly know that those AI stocks that are good quality companies probably will come back because if they provide what we think they can provide, which is mainly productivity to businesses, AI is a winner. Two stocks I see you do like are AMD and Intel. Would you describe them as AI related stocks? Number one, and you’re and you’re and you’re you’re choosing one that is a beloved stock in AMD and another that has been at a loss for love lately. Intel. Yes. Yeah. Well, I always like to have, you know, a winner and a loser. Now I’m teasing. Totally teasing. No, I do like both of these and I like them for different reasons. However, both of them can and probably will play into generative AI data centers. But the other thing is there is going to be a lot of computing needed around those data centers. And I think both of these companies have good track records of playing well in data centers and data centers are a focus of spending. So that’s why I’m focused on it. I also like Intel’s foundry idea and it’s always takes longer to develop technology and roll things out. We know that and we learned that earlier this year. And that’s one of the large big reasons behind Intel’s unlovedness right now in the market. Yeah.