Quick Read – GEV turbine pricing doubled to $2,500/MW with a record $150B backlog while NVDA operating income surged 147%, yet consensus models still underestimate both. – Crawford argues sell-side linear models can’t capture an exponential capex cycle, leaving Street EPS…
timates systematically too low across the entire AI supply chain. – On a recent episode of the Animal Spirits podcast titled Talk Your Book: AI Is Not a Bubble, Alger portfolio manager Dr. Ankur Crawford made a deceptively simple argument that cuts against most of the current debate over AI valuations: investors are arguing about the price-to-earnings ratio without first agreeing on what the earnings actually are. “The first thing you need to get right when you think about valuation is the E
Only then can you come up with a PE,” Crawford said. She runs a concentrated 30-name portfolio and targets companies she believes can double or triple over a roughly three-year horizon. She contends that sell-side models are linear extrapolations bolted onto an exponential capex cycle, leaving Street estimates “just too low” across the AI supply chain.
The Case Study: GE Vernova Crawford pointed to GE Vernova (NYSE: GEV) as the cleanest illustration. Only three companies make combined-cycle gas turbines globally, GE Vernova holds roughly a third of that market, and pricing has doubled from about $1,250 to $2,500 per megawatt in under a year as hyperscalers scramble for firm power. The financials support the framing.