It’s hard to even think about being a buyer of stocks at a time like this. Indeed, whenever a large daily dip is followed by another one, it seems like a good idea to hit that sell button before more of the same wipes out more of one’s portfolio. Indeed, tariff volatility has made it really tough to navigate these markets. It’s not just about their severity and the impact on the economy, but their uncertain, escalating nature.

Undoubtedly, things can start with tariffs, only to escalate to a trade war that spirals until both sides end up with economies in a far worse state. With recession and inflation risks rising and a U.S. dollar that could weaken, questions linger as to how investors should react (or not) in the coming month. It’s not just tariffs and macro woes that have unsettled the market, though. The AI trade is continuing to unravel. Whether it’s extended valuations, DeepSeek, or regulatory unknowns, the tech sector has been hit a whole lot harder. 

With the Nasdaq 100 down over 12% from all-time highs, many hard-hit AI stocks have gone from quite expensive to mildly expensive or even cheap. Indeed, AI hasn’t pulled the brakes and there’s no AI pause on the table. Despite the recent volatility, it’s still business as usual for firms racing to dominate on AI.

And in that regard, I think the AI boom is still very much on the table. Indeed, the AI boom could stay strong going into an economic downturn. Though, the effect on AI and tech stocks is less uncertain, given the tug-of-war with other macro variables.

Stanley Druckenmiller looks to be playing the long game on AI

Stanley Druckenmiller is one of my favorite big-name investors to keep tabs on, given his ability to skate to where the puck is going. The legendary investor punched his ticket to Nvidia (NASDAQ:NVDA) and the AI boom quite early (all the way back in 2022, before ChatGPT took off). Though he’s since sold out of the GPU maker as of last year, his prior remarks, I believe, continue to shine a light on AI’s long-term potential.

“AI might be a little overhyped now but under-hyped in the long term,” Druckenmiller said close to 10 months ago in a sitdown with CNBC. “The big payoff might be four to five years from now.”

Sure, Druckenmiller may have been a tad too soon to sell Nvidia. But it’s far better to have sold a bit early than too late, as is the case with many investors who may have bought at prices above $120 per share. With Nvidia stock now down close to 30%, the big question is whether enough froth has been taken out such that such an AI leader is now a relative bargain. I’m not so sure. Either way, I think there’s deeper value to be had elsewhere.

Though we can only guess what Druckenmiller is up to amid this latest market slide, I do think the Duquesne fund is full of intriguing names that are as under-hyped as they are undervalued. I’d encourage investors to check out the full list of his fund’s holdings for a better idea of where the value may be at in AI and elsewhere.

Should they stand to get cheaper from here, many of the names may be worth a pick-up. In this piece, we’ll check in on one of my favorite Druckenmiller-held names:

Seagate Technology

Seagate Technology (NASDAQ:STX) is a data storage hardware maker behind HDDs (Hard Disk Drives), SSDs (Solid State Drives), and other solutions. It’s one of the largest HDD makers on Earth, and it’s leading the charge in data storage innovation — think more, faster data in smaller forms.

Undoubtedly, we’ve heard a lot about GPU firepower in the past few years of the AI boom. However, let’s not forget that more than just AI accelerators are needed to help data centers deliver the AI compute needed to process growing demand. Indeed, memory solutions and all the sort still play a vital role in supplying the growing demand for AI. 

While the rise of efficient models may be a headwind for GPU makers, any increased demand that comes with more affordable AI compute could be a boon for the data storage makers. The stock is down more than 23% from its recent high and is going for a mere 9.6 times forward price-to-earnings (P/E) — that’s ridiculously cheap, in my view.

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