Peter Schiff, chief economist and global strategist at Europac, has warned that the AI stocks bubble burst is at hand amid the ongoing selloff in Space Exploration Technologies Corp. (NASDAQ: SPCX) shares.
Schiff believes Artificial Intelligence (AI) is not a bubble. However, he noted that the AI stocks bubble has ‘likely already popped’, according to an X post on July 20, which Finbold analyzed on July 21.
“AI isnt a bubble, but AI stocks are. The bubble has likely already popped,” Schiff noted.
Schiff noted 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 AIs Kimi K3 and DeepSeek Chat.
“SpaceX closed under $120, near the low of the day. Thats 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？
As Schiff believes that AI is not a bubble but AI stocks are, AI stocks 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 could be invalidated if Wall Street analysts’ targets are achieved over the next 12 months.