Strip AI infrastructure and energy from the S&P 500’s forward earnings picture and growth collapses to zero. That’s the single most uncomfortable number from Lance Roberts’s recent appearance on Adam Taggart’s Thoughtful Money, and it reframes everything about market risk right now.
Roberts, chief investment strategist at RIA Advisors, walked through what he called the concentration ladder hiding inside the index. “Here’s the cumulative year-to-date change in consensus 2027 EPS estimates AI infrastructure stocks, 32%. Energy is 19%. S&P 500 is 8%,” he said. Then he delivered the punchline: “If you look down at the bottom, the gray line, S&P 500 ex-AI infrastructure and energy, it’s 0% growth.”
The Index Number Hides the Engine
An 8% lift in 2027 EPS estimates sounds healthy. Spread evenly across 500 companies, it would be normal corporate progress. But it isn’t spread evenly. Most of the earnings improvement is concentrated in the Magnificent 7, with semiconductors just below. The rest of the economy is barely increasing earnings growth at all this year.
That maps cleanly onto what prices show. The S&P 500 is up 9% year to date as of last Friday’s close. The Nasdaq-100 is up 16.8% over the same stretch. NVIDIA (NASDAQ:NVDA | NVDA Price Prediction) alone has added 15% year to date and 62% over the trailing year. The market-cap-weighted index is doing exactly what its earnings revisions suggest: leaning on a handful of names that print AI infrastructure cash.
The Rebar Example
Roberts made the dependence concrete in a way I keep thinking about. “If I’m a company that builds rebar or makes rebar, I’m sold out right now just trying to sell rebar to people building data centers… But the end buyer is the data center,” he said. A steel fabricator does not screen as an AI stock. Its order book tells a different story.
That extends to interconnects, cooling, power delivery, generation equipment, transformers, switchgear, concrete, fiber, and industrial REITs renting the land underneath it all. Bureau of Economic Analysis data shows the information sector grew from $265.0 billion in profits in 2024 Q1 to $317.7 billion in 2025 Q4, while retail profits drifted in a narrow band of $390.2 billion to $422.6 billion across the same window. The capital is flowing where Roberts says it is.
As he put it, “What markets are pricing is the impact of that CapEx spending on the economy that generates the earnings.” The market is pricing the CapEx impulse from AI as the engine of the broader economy.
Taggart’s Sled Dogs
Taggart gave the setup its image. “It’s like being an Eskimo, you know, ice sledder, where your team of sled dogs is basically a bunch of Chihuahuas with a huge bull in the front… If that bull stumbles, breaks a leg, and you’re just depending on the Chihuahuas, you’re going nowhere.”
His read on the asymmetry was direct: “As long as this continues, I think it’s going to be super hard for a recession to occur. It’s probably going to be super hard for any prolonged market downturn to really occur. But man, if something were to get in the way of those flows then it could be Katy bar the door.”
The VIX closed Thursday at 16.76, down 14% over the past month, sitting in the bottom half of its 12-month range. Options markets are not pricing disruption to the bull at the front of the team. Goldman Sachs Asset Management’s 2026 outlook flagged equity market concentration as one of the defining risks of the year for exactly this reason.
What I’m Doing With This
I’ve owned NVIDIA for over 15 years and I’ve been watching the CapEx cycle compound for the last three. The honest version of Roberts’s warning is that if you own the S&P 500, you already own the AI CapEx trade whether you meant to or not, even if AI spending continues.
Go through your portfolio and ask which holdings are functionally indexed to data center construction. The rebar maker counts. So does the utility, the cooling specialist, the industrial landlord, and the regional bank financing the build. If the bull stumbles, you want to know which of your holdings can pull, and which were quietly riding the sled the whole time.
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