Brad Conger, chief investment officer at Hirtle Callaghan, sat down on Barron’s Streetwise with Jack Hough this month with a message every AI investor should hear before clicking buy. “I think there’s just an amazing level of confidence that the winners of AI today will be the winners tomorrow,” he said. The math behind that confidence should make you pause.
Conger’s framing: “The idea that companies actually can’t grow 10 years in a row at 100%, which is what’s required if you’re paying, you know, 150 times sales for something.” Stretch a price-to-sales multiple that high and you’re underwriting a decade of doubling revenue every year. No public company has ever done that.
The 1999 Story Worth Re-Reading
Conger’s cautionary tales are Cisco and Juniper Networks. Both built the real plumbing of the internet. Both saw growth decelerate over many years, eventually settling into a low-double-digit range. The companies were right about the technology. The stocks still spent years working off the valuations. Owners who bought at the peak waited a very long time to break even, and some never did at the original ticker.
Conger’s Own Caveat: AI Is Real
Here is where Conger separates himself from the permabears. He calls AI “a real innovation” with “more applicability to the world” than crypto, NFTs, or the cannabis frenzy from eight years ago. AI, he says, will be “with us for a long time.” Jack Hough said: “Better than the apes in cannabis, but you gotta be careful about the prices.” You can listen to the full episode on Barron’s.
The market is already pricing in some of this caution. A TradingKey analysis this weekend noted that memory names like SanDisk and Micron have rallied even as forward multiples compress, and chipmakers sold off sharply despite Q2 FY2026 revenue of $10.6 billion and EPS of $2.65. Insider selling at major tech names tells you executives see the same prices we do.
Where I Respectfully Disagree
I’ve owned NVIDIA (NASDAQ:NVDA | NVDA Price Prediction) for over 15 years and Meta (NASDAQ:META) since December 2022, so I have skin in this debate. The NFT comparison I don’t buy. There is real revenue flowing through these AI companies and real cost savings showing up inside the businesses deploying the technology. That is different than holographic worms.
On Conger’s harder claim, that no company can compound at triple-digit rates for a decade straight, I’d push back gently. A small handful of companies will compound at a rate that approximates it over the next decade. Two things can be true at once. AI stocks can trade lower at various points AND finish substantially higher than today. Frontier technology investing has always looked like that. Volatility on the path, value creation at the destination.
The Synthesis
Take Conger’s valuation warning seriously. A nosebleed price-to-sales multiple should make your stomach turn. Take his hype warning seriously too. Then refuse to lump AI in with NFTs, and refuse to write off the rare compounders that justify the patience. As Conger himself reminds us, “The future is more uncertain than you can imagine.” Price your portfolio for that, and you’ll be fine on either side of this debate.
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