The New AI Trades

Exchanges

Goldman Sachs

Business

4.3 • 1.1K Ratings

🗓️ 17 February 2026

⏱️ 16 minutes

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Summary

Goldman Sachs Research’s Ryan Hammond explains how AI disruption is creating large sector rotations even as equities continue to move higher. This episode was recorded on February 11, 2026. The opinions and views expressed herein are as of the date of publication, subject to change without notice, and may not necessarily reflect the institutional views of Goldman Sachs or its affiliates. The material provided is intended for informational purposes only, and does not constitute investment advice, a recommendation from any Goldman Sachs entity to take any particular action, or an offer or solicitation to purchase or sell any securities or financial products. This material may contain forward-looking statements. Past performance is not indicative of future results. Neither Goldman Sachs nor any of its affiliates make any representations or warranties, express or implied, as to the accuracy or completeness of the statements or information contained herein and disclaim any liability whatsoever for reliance on such information for any purpose. Each name of a third-party organization mentioned is the property of the company to which it relates, is used here strictly for informational and identification purposes only and is not used to imply any ownership or license rights between any such company and Goldman Sachs. A transcript is provided for convenience and may differ from the original video or audio content. Goldman Sachs is not responsible for any errors in the transcript. This material should not be copied, distributed, published, or reproduced in whole or in part or disclosed by any recipient to any other person without the express written consent of Goldman Sachs. Disclosures applicable to research with respect to issuers, if any, mentioned herein are available through your Goldman Sachs representative or at http://www.gs.com/research/hedge.html Goldman Sachs does not endorse any candidate or any political party. © 2026 Goldman Sachs. All rights reserved. Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	If you look at an index like the S&B 500, you'd think it's been a quiet start to the year for U.S. stocks.
0:11.6	But there have been seismic shifts under the surface, with soft-for stocks in particular moving dramatically.
0:17.5	So what's behind these moves and what do they tell us about the state of this long running bull market?
0:22.8	I'm Alison Nathan and this is Goldman Sachs exchanges.
0:25.5	Today I'm sitting down with Ryan Hammond, a portfolio strategist in Goldman Sachs research.
0:29.7	Ryan, welcome back to the program.
0:30.8	Thanks for having me.
0:32.1	So Ryan, let's start where the price action has been really volatile in recent days, software stocks. Put some
0:39.1	numbers around these moves. Give us some context about what we've seen. Yeah, a group of software
0:43.8	stocks is down about 25% to start the year. Some of that selling pressure started earlier than
0:49.2	2026. These stocks are down more than 30% from their highs in October, but most of the selling pressure
0:55.0	has really occurred in the last week or two. If you think about it in a valuation context,
0:59.5	these stocks are super popular among investors, in part because they're fast-growing high-margin
1:04.4	businesses, but that is coming under some scrutiny from investors. And so, you know, a couple of
1:10.4	weeks ago, these stocks traded
1:11.6	at a forward earnings multiple of about 35 times because of those attributes. As of the latest
1:16.8	readings, they trade at about 20 times forward earnings. So a huge valuation derating. And when you
1:22.1	think about it relative to the rest of the market, they went from trading at a premium of more than
1:25.9	100% to the rest of the market to just 20% today. And if you look historically, they went from trading at a premium of more than 100% to the rest of the market
1:27.7	to just 20% today. And if you look historically, that valuation premium is now approaching
1:33.5	levels you reached in the global financial crisis. And so when we think about it relative
1:38.5	to fundamentals, to us it seems like investors have gone from valuing this group of stocks
	...

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