"Capacitors Are The New Memory": Why Goldman Thinks Soaring Capacitor Demand Will Spark Huge Gains In These Stocks

While pure-play AI enablers such as Nvidia and the hyperscalers were the initial beneficiaries of the nascent AI supercycle, over the past year we have observed that the most memorable winners were not the pure plays (until recently Nvidia was unchanged since last October) but rather the makers of "picks and shovels", or companies that address the core bottlenecks in the AI rollout. Initially it was the data-center names, then infrastructure, then energy and nuclear, then starting last September we saw an unprecedented ascent of memory stocks (a highly commoditized sector, prone to booms and busts yet whose returns so far this cycle have been nothing short of staggering). 

An indicative hierarchy of AI infrastructure, where supply tightness drives pricing power and thus stock appreciation, is shown below courtesy of Goldman's thematic investing team (we shared a much more in-depth analysis of the various rack components for Nvidia's upcoming Vera Rubin rack here).