As the new round of financial reporting season unfolds, investors are eager to see $S&P 500 Index (.SPX.US)$ how artificial intelligence investments in component stocks companies will generate returns.

Since last year, AI-related companies have been dominating the financial reporting season, driving a significant market increase. The S&P 500 index is currently at a historical high, rising by about 21% year-to-date, mainly benefiting from strong performances in the technology and communications sectors.

Howard Chan, CEO of Kurv Investment Management, pointed out that analysts are eager to evaluate how large companies monetize their AI initiatives, and those successful in this aspect will receive significant returns. For example, after Meta (META.US) provided strong sales growth expectations, its stock price surged, indicating that its digital advertising revenue effectively funded its AI investments.

Chan added that on the contrary, tech giants like Google (GOOGL.US) spending on AI technology has raised doubts about its integration with existing business models.

Chan added, on the contrary, $Alphabet-A (GOOGL.US)$ The spending of giants in artificial intelligence technology has raised doubts about its integration with existing business models.

Intelligence Finance App has learned that as the new round of financial reporting season unfolds, investors are eager to see how artificial intelligence investments in S&P 500 index component stocks generate returns.

Solita Marcelli of UBS Group's global wealth management expressed optimism, stating that the upcoming third-quarter financial report may further drive the rise, especially as the semiconductor industry remains a focus for artificial intelligence investments.

Best investment target: Nvidia

As the biggest beneficiary of the artificial intelligence boom, $NVIDIA (NVDA.US)$ the stock price has risen by more than 170% year to date. However, the market still sees further upside potential for the stock.

In September this year, consulting firm Bain & Company stated that the potential market size for artificial intelligence hardware and software is expected to grow by 40%-55% in at least the next three years. By 2026, demand for Nvidia's next-generation GPU GB200 is projected to reach 3 million units, compared to the expected 1.5 million units for its H100 by 2023.

Morgan Stanley rates Nvidia as 'shareholding' with a target price of $150. Following a three-day non-trading roadshow with Nvidia's CEO Jensen Huang, CFO Colette Kress, and other management team members, Morgan Stanley stated, "The meeting highlighted the scale and length of the accelerated computing runway, and every sign from the management indicates that we are still in the early stages of a long-term artificial intelligence investment cycle."

A report from the bank stated that Blackwell's NVL36/72 system remains the best solution for reasoning interaction requiring significant computing, with Blackwell's production ramp-up progressing as planned, and capacity for the next 12 months already fully booked, indicating ongoing strong demand.

Bernstein analysts stated that sustainability is the main concern Nvidia faces after experiencing astonishing growth, but "now is clearly not the time to worry."

Melius Research analyst also gave the stock a 'buy' rating with a target price of $165, noting that the company plans to increase production of Blackwell chips in the fourth quarter.

Editor/Rocky