The AI Herd Lifts Its Noses. Is a Wildfire Blazing on the Ridge?
May 7, 2026
Another dinobaby post. No AI unless it is an image. This dinobaby is not Grandma Moses, just Grandpa Arnold.
Ah, May, a time for insiders to dump shares in AI-centric companies. Like rain, signals are ruining an otherwise sunny day. As I write this, the Motley Fool has issued a news release that says, “Nvidia, Palantir, and Broadcom Are Sending Shockwaves Through Wall Street With This $4.6 Billion Warning.”
Thanks, Midjourney. The sheep aren’t sniffing, but they are getting ready to bail out. Good enough.
What is the warning? The AI craziness may be facing some headwinds. The write up stated on May 4, 2026:
… no companies have benefited more from the evolution of AI than graphics processing unit (GPU) titan Nvidia, data-mining specialist Palantir Technologies, and networking solutions kingpin Broadcom. Broadcom joined the trillion-dollar club in December 2024, Nvidia became the first public company to top $5 trillion in October 2025, and Palantir shares have skyrocketed 2,100% since the end of 2022. While all three companies possess undeniable competitive advantages, the people who know these businesses best are sending worrisome signals.
I interpret the message as “get out of Dodge.” Others have interpreted the “signals” in the same way. The article said:
Collectively, the hardware, networking, and application companies leading the AI revolution have seen their insiders dispose of approximately $4.6 billion in shares over the trailing 12 months.
To be fair, these stock sales have taken place over a reasonable span of time. Nevertheless, the herd mentality sniffs the wind to make sure no wildfire is heading toward the grazing ground to turn a nice day in May into a large barbeque.
The article includes some financial jargon, but the interpretation of the faint whirrs, beeps, and buzzes comes through:
The time-tested price-to-sales (P/S) ratio strongly suggests this AI trio is historically expensive. Over the last three decades, P/S ratios above 30 for companies at the forefront of next-big-thing trends have signaled the presence of a bubble. As of the closing bell on April 28, Nvidia, Broadcom, and Palantir had respective trailing 12-month P/S ratios of 24, 28, and 81. Executives at Nvidia, Palantir, and Broadcom may be optimistic about their company’s future, but their actions say otherwise.
The phrase “but their actions say otherwise” is suggestive. For this dinobaby, those cashing in or bailing out are likely to trigger herd behavior.
Several observations are warranted:
- One sells when one wants to get cash following my father’s rule: Acquire low. Sell high. Reasonable advice.
- “Talk positive and be ready to jump” may be a tattoo on some of the AI prepper’s skin.
- Those interested in the health of the AI sector will want to watch for “tells.” The body language professionals may provide some insight in their YouTube-type explanations of squints, twitches, and side eyes.
Net net: I personally smell fire.
Stephen E Arnold, May 7, 2026
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