Tom Lee, the managing partner and head of research at Fundstrat Global Advisors, shared his bullish prediction for the S&P 500, foreseeing it reaching 15,000 by 2030 riding the AI wave.

What Happened: Lee's forecast is based on the emergence of a new cycle in the stock market, where annual returns are expected to compound at a high rate. This cycle is being driven by the younger generations, particularly millennials and Gen Z.

"This will be the 3rd time that stocks entered a cycle where annual returns compound at high teens," Lee said in an interview with CNBC's Last Call.

The growth of companies focused on artificial intelligence is expected to yield high returns, according to Lee. Additionally, the increasing number of digital laborers investing in the economy is contributing to this cycle.

S&P 500 ETF options provide investors with multiple ways to invest in America's largest 500 companies. Interested investors may check out the Schwab U.S. Large-Cap ETF (NYSE:SCHX), Vanguard S&P 500 ETF (NYSE:VOO), and iShares Core S&P 500 ETF (NYSE:IVV) to diversify their portfolios.

Why It Matters: Lee's prediction is in stark contrast to the forecasts of other financial experts. In May, Goldman Sachs predicted a flat return for the S&P 500 for the remainder of 2024, suggesting that the stock market rally had peaked. However, Lee's forecast indicates a more extended period of growth.

Another analyst, Gene Munster, predicted that the stock market would continue to rise for another three to five years before an AI bubble bursts. This aligns with Lee's forecast of a sustained period of growth driven by AI-focused companies.

However, not all experts share this optimistic outlook. Economist Harry Dent warned of a looming "crash of a lifetime" due to the current "everything" bubble, which he believes has yet to burst. Despite this, Lee's prediction suggests a period of sustained growth, particularly in the AI sector.

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This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote