Michael Hartnett, Bank of America’s chief investment strategist, argues that long-term bonds from large digital infrastructure providers such as Oracle, Meta, and Alphabet offer a better risk-return proposition than their shares. The cited yields range from 6.9% for Google to 8.4% for Oracle and 7.5% for Meta, following an approximately 9% decline in the price of these bonds year to date. The rise in yields reflects surging artificial intelligence spending, which Bank of America projects will push hyperscaler capital expenditure to $1.2 trillion by 2027. Bond issuance by these companies is expected to reach $182 billion in 2026, compared with $17 billion in 2024, while their free cash flow is projected to swing from $240 billion to a $180 billion deficit. Hartnett favors gaining exposure to artificial intelligence through debt but recommends a risk-off stance through mid-November 2026 because of rising bond yields and geopolitical risks.
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