Original Title: Tom Lee's 2026 Investment Core Logic: 'Companies Selling Scarce Assets Are Crushing the Market'
Original Author: Chris Lee
Tom Lee, founder of Fundstrat and manager of the Granny Shots fund, recently stated that the single most important investment keyword for the 2026 market is "scarcity." He bluntly said, "Companies selling scarce assets are crushing the market." This seemingly simple statement contains a complete stock selection logic, macroeconomic judgment, and deep convictions about Fed policy and geopolitics.
I. Core Definition and Logic of Scarce Assets
The "scarce assets" defined by Tom Lee are not traditional scarce items like gold or collectibles, but rather **products or services with severely constrained supply and explosively growing demand**. This structural supply-demand mismatch grants sellers extremely strong pricing power, driving outsized returns.
He highlights three major areas of scarcity:
1. AI Compute Power: Companies like NVIDIA, AMD, Intel. AI large model training and inference require massive amounts of GPU and accelerator chips, but capacity expansion for TSMC's advanced nodes, CoWoS packaging, etc., has physical limits. According to related reports, the tight supply of AI chips will persist at least until the end of 2026.
2. AI Memory (HBM - High Bandwidth Memory): Manufacturers like Micron, SanDisk. In AI servers, HBM is as critical a bottleneck as GPUs, with complex manufacturing processes and slow yield improvements; capacity has already been fully booked by giants like NVIDIA.
3. Energy Infrastructure: Companies like GE Vernova (GEV). Data center power demand is growing explosively; by 2030, North American data center electricity consumption is expected to account for 9-10% of total power generation (only 3-4% in 2025). Delivery cycles for large equipment like gas turbines and transformers are as long as 2-3 years, with extremely slow capacity expansion.
The logic chain: The AI revolution brings explosive demand, while physical, process, and time constraints on the supply side cannot quickly match it. This supply-demand imbalance is not a short-term phenomenon but a structural opportunity throughout 2026. Precisely because of this, these companies have high gross margins, strong pricing power, and their performance and stock prices far exceed the market average. This is also the core strategy of the Granny Shots fund—focusing on "companies selling scarce things." The fund's AUM has surpassed $4 billion, with money voting with its feet.
II. Macro Background and Practical Trading Framework
Tom Lee emphasizes that the market is currently in a "fog of war," with persistent geopolitical risks. However, he observes that oil prices seem to have peaked and provides a clear trading framework: When oil prices fall, one should buy assets negatively correlated with oil prices, including the S&P 500, Ethereum, and the Mag7 (Magnificent 7).
The logic is: Falling oil prices → easing inflation pressure → rising expectations for Fed rate cuts → benefiting growth stocks and risk assets. Wars may push oil prices up, but a peak and subsequent decline in oil prices can instead become a positive signal to buy growth stocks. This offers investors a practical guide for contrarian action in an uncertain environment.
III. Strong Earnings and Full-Year Market Outlook
This quarter's earnings season has been exceptionally strong: Among companies that have reported, 87% beat expectations, with the beat averaging 19%. Tom Lee points out that this is "emerging market-level" profit growth happening in the U.S., driven by the productivity revolution brought by AI.
Market Path Judgment:
The S&P 500 has reached the 7,300-point target set at the beginning of the year, but **it's not yet time to sell**.
A "feel like a bear market" correction may occur mid-year, potentially driven by the market testing a new Fed Chair or prolonged geopolitical conflicts.
Following the correction, a rebound is expected, with the full-year target revised up to at least 7,700 points, maintaining an overall bullish stance.
He specifically reminds: The Mag7, cryptocurrencies, and software sectors have already experienced a bear-market-like correction. Investors shouldn't chase highs at 7,300 points, nor panic during a pullback—the pullback is precisely a good opportunity to add to scarce assets.
IV. Theme Ranking and Practical Insights
Tom Lee ranks investment themes as follows:
1. Global Labor Scarcity + AI (Top Priority): Aging populations are driving up labor costs, forcing companies to replace human labor with AI and automation—a decade-long structural trend.
2. Cybersecurity + Energy Security (Second Priority): Geopolitical tensions are prompting increased investment in related infrastructure across countries.
3. Seasonal Factors.
Weekly performance of Granny stocks also validates this framework: Top gainers like Qantas, Google, Caterpillar, Tesla, AMD all align with the scarcity logic; some short-term pullbacks (e.g., GE Vernova, Sofi) are mostly due to guidance falling short of the market's overly high expectations, representing normal volatility that doesn't alter the long-term trend.
Conclusion: The Investment Code for 2026 is "Scarcity"
Tom Lee's complete logic chain is clear and powerful: AI-driven structural demand + supply constraints = pricing power and excess returns for scarce assets. Amid macroeconomic uncertainty, peaking oil prices signal growth stocks, a mid-year correction is an opportunity to add positions, and the full-year S&P 500 could challenge 7,700 points.
For investors, the real takeaway is not simply chasing rallies, but shifting one's mindset: from "what's rising" to "why it's rising." Only by seizing companies with constrained supply and explosive demand can one achieve sustained excess returns in 2026. Scarcity is not just a concept; it's the tangible hard constraint of supply and demand—this is the most important investment framework Tom Lee leaves for the market.
