Peter Schiff, chief economist and global strategist at Euro Pacific Asset Management, has warned that the AI stocks bubble may be about to burst amid the ongoing selloff in Space Exploration Technologies Corp. (NASDAQ: SPCX) shares.
Schiff believes Artificial Intelligence (AI) is not a bubble. However, he said that the AI stocks bubble has ‘likely already popped’, according to an X post on July 20, which Finbold analyzed on July 21.
“AI isn’t a bubble, but AI stocks are. The bubble has likely already popped,” Schiff noted.
Schiff highlighted that the ongoing SpaceX stock selloff could be a leading indicator of the ongoing AI stocks bubble burst. Furthermore, he argued that AI stocks in the United States are facing intense competition from low-cost Chinese AI models led by Moonshot AI’s Kimi K3 and DeepSeek Chat.
“SpaceX closed under $120, near the low of the day. That’s more than 11% below the IPO price. The chart is not looking good,” Schiff added in a follow-up post.
Which AI stocks are good to buy in 2026?
While Schiff points to an AI stocks bubble burst, AI companies that are aligned with enterprise spending and mainstream adoption of technology are well positioned to benefit. For instance, despite Micron Technology, Inc. (Nasdaq: MU) stock dropping more than 28% over the past 30 days, trading at $865.46 at press time, 30 Wall Street analysts surveyed by TipRanks have set an average 12-month target of about $1,569.29, thereby suggesting a potential 81.32% upside.
Additionally, although Nvidia Corp. (NASDAQ: NVDA) shares have dropped 2.57% over the past 30 days, trading at about $203.28 at the time of publication, 37 Wall Street analysts surveyed by TipRanks have set an average 12-month target of $309.94, which signals a possible 52.47% upside.
Meanwhile, 17 Wall Street analysts surveyed by TipRanks have set a 12-month average price target for Sandisk Corp. (NASDAQ: SNDK) at $2,041.88, despite the shares falling more than 39% over the past 30 days, to trade at about $1,390 at the time of reporting.
As such, Schiff’s forecast of the AI stocks bubble burst could be invalidated if Wall Street analysts’ targets are achieved over the next 12 months.
Featured image via Peter Schiff YouTube.
