Tech stocks are having their worst stretch of performance relative to the broader market in half a century. Goldman Sachs says that’s exactly why you should be paying attention.
This Tuesday morning, with oil topping $115 a barrel and markets on edge over Trump’s Iran deadline, Goldman Sachs dropped a note that cut against the prevailing fear. Peter Oppenheimer, the bank’s chief global equity strategist, told clients that the sell-off in U.S. tech has now created what he called — without much hedging — a generational buying opportunity.
That’s a big claim. Goldman doesn’t throw that phrase around casually.
Fifty Years Is a Long Time
Here’s the hard number behind the headline: U.S. tech stocks are now suffering their worst stretch of underperformance against the broader market in fifty years. Not since the early 1970s — before the personal computer, before the internet, before the iPhone — has tech lagged the S&P 500 this badly for this long.
Think about what that span covers. The dot-com crash of 2000. The 2008 financial crisis. The 2022 rate-shock selloff. Tech bounced back from all of those — usually hard and fast. This time, the headwinds are different, which is precisely what makes Goldman’s call so provocative.
The war in Iran has reshuffled capital flows in ways that would have seemed improbable two years ago. Energy, defense, and commodity plays have hoovered up institutional money that used to sit comfortably in mega-cap tech. The Nasdaq is down sharply year-to-date. Meanwhile, sectors that nobody talked about in 2023 — tankers, oil services, defense contractors — are having banner years.
That rotation doesn’t mean tech is broken. It might mean tech is cheap.
What Goldman Is Actually Saying
Oppenheimer’s team isn’t making a tactical call about the next week or two. This is a structural argument. The thesis goes something like this: the same forces that are hammering tech multiples — higher-for-longer rates, geopolitical uncertainty, a resurgence in real assets — are cyclical. They don’t change the fundamental earnings power of companies like Nvidia, Microsoft, or Alphabet over a five-to-ten year horizon.
And when everyone abandons a sector for reasons that are partially temporary, that’s when long-duration value tends to accumulate quietly.
To be fair, Goldman has been known to call bottoms that aren’t quite bottoms. The bank’s strategists have a mixed record on big macro calls, and “generational opportunity” language can age poorly if the next phase of the Iran conflict sends oil to $150 and the Fed hikes again. Rates are the single biggest variable here — tech valuations are extraordinarily sensitive to the discount rate, and if inflation re-accelerates, multiples compress further regardless of how good the underlying businesses are.
That caveat matters. But so does the signal.
The AI Factor That Nobody’s Talking About
Buried under all the geopolitical noise is something that hasn’t gone away: AI capital expenditure is still running hot. Microsoft, Google, and Meta have not pulled back on their datacenter buildouts. Amazon Web Services is expanding capacity. Nvidia’s order book, despite supply chain wobbles, remains one of the strongest in the market.
The narrative around AI peaked in early 2025 and has been in a sustained reset — partly valuation-driven, partly because the initial wave of enterprise AI adoption is proving slower and messier than the bulls expected. But slower isn’t stopped. The capex numbers coming out of Big Tech every quarter are staggering. They wouldn’t be spending at that clip if they didn’t believe the returns were coming.
Here’s the thing: if you believe AI is a multi-decade productivity shift — and the companies spending the most on it clearly do — then a 50-year low in tech’s relative performance looks less like a red flag and more like a setup.
The Contrarian’s Dilemma
The problem with contrarian calls is that they require you to hold through more pain before they pay off. Tech bulls who bought the dip in late 2025 have mostly been wrong — or at best, early. The sector keeps finding new ways to disappoint, whether it’s multiple compression, guidance cuts, or just getting crowded out by energy and defense in investor portfolios.
Historically, though, the best entry points in any sector come when consensus sentiment is most negative. And right now, tech sentiment is about as negative as it’s been since the post-2000 reckoning. Fund managers who were overweight Nvidia 18 months ago are now quietly underweight the entire sector.
That’s not nothing. That’s a contrarian signal.
Goldman’s note this morning arrives in a market that is, understandably, consumed by oil prices, Iran deadlines, and the Fed’s next move. Those are real risks. They’re not going away this week. But Oppenheimer’s team is essentially saying: zoom out. At 50-year lows in relative performance, the risk-reward on tech has shifted — and the investors who recognize that first will likely be the ones writing about their “generational trade” a few years from now.
Whether that’s Goldman being bold or Goldman being right is a question only time will answer. But the data they’re pointing to is real, the historical precedent is legitimate, and the call deserves more attention than it’s getting on a morning when everyone is watching oil tickers and Iran headlines.
Sometimes the most important story isn’t the loudest one.
Disclosure: This article is for informational purposes only and is not investment advice.