The stock market is up strongly this year with the help of multiple tailwinds, including cooling inflation, an easing of Federal Reserve interest rate hikes, and a resilient U.S. economy, among other things. So far in 2023, the S 500 index has gained nearly 15%.

The Nasdaq Composite logged even stronger gains of 28.7%, driven by a solid rally in technology stocks thanks to new catalysts such as artificial intelligence (AI). The investor enthusiasm over the potential of AI is part of why Nasdaq components like Nvidia (NASDAQ: NVDA), Meta Platforms (NASDAQ: META), and (NASDAQ: TSLA) have shot up remarkably in 2023. Not surprisingly, all three stocks now trade at lofty valuations.

A closer look at their businesses indicates that these three stocks have what it takes to justify their rich valuations and deliver robust growth. Let's see why that might be the case.

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Source Fool.com