Travel stocks and tech are two hot places to invest this year. So far in 2023, Nvidia (NVDA 1.63%), Meta Platforms (META -1.13%), and Carnival Corp. (CCL 0.94%) have been the best-performing stocks on the S&P 500, and they are all up more than 130%.

With returns like that in just over six months, investors may be hesitant to jump into already scorching-hot valuations. Is it too late to buy these stocks, or can you still expect to make a good return from buying shares of these three top S&P 500 companies?

1. Nvidia

Nvidia is the newest member of the $1 trillion club. It reached that threshold in large part because its stock has been on fire this year, rising 190% thus far in 2023. And a big part of the reason for the price bump is investors' excitement that the company's chips are used in artificial intelligence (AI) applications and help train chatbots. Nvidia's chips and other products are expected to be in high demand for many businesses looking to build AI platforms and products. 

The company smashed expectations in fiscal 2024's first quarter (ended April 30) when it forecast revenue of $11 billion for Q2 (which ends in July) -- over 50% higher than analyst projections of roughly $7.2 billion.

For all the hype so far in 2023, there are also concerns for investors to consider. The first is the valuation. The stock trades at an estimated 56 times its future earnings. And both its price-to-book and price-to-sales multiples are over 40. A lot of the stock's future performance already appears to be priced into its current valuation. 

There is also some risk with Nvidia's stock, particularly when it comes to the Chinese market. China accounts for up to one-quarter of the company's data center revenue. And with U.S.-China relations still on shaky ground and potential restrictions on what chips Nvidia can export to China, investors need to be wary of the risk involved.

Given the geopolitical uncertainty and Nvidia's sky-high valuation, this isn't a stock I'd buy right now. While Nvidia's future is promising, the valuation does appear to have gotten out of hand.

2. Meta Platforms

Share prices of Meta Platforms are up 141% so far in 2023 as it makes up for a brutal year in 2022 when its share price plummeted by 64% (that's the worst performance of the stocks listed here). Meta's stock would need to climb by another 34% for the company to get to a $1 trillion market cap. But I wouldn't expect that to happen this year. The company's growth is still a big question mark.

Revenue of $28.6 billion for the first three months of the year was only up 3% year over year. Meanwhile, the company's bottom line declined by 24% year over year to $5.7 billion as its Reality Labs segment (which is focused on the metaverse) continued to be a drain on profitability, incurring operating losses of $4 billion. Meta recently launched Threads, a rival to Twitter, but that may also prove to be a money-losing venture as it may end up ramping up competition between the two companies.

Meta's valuation is a bit more modest than Nvidia's, trading at a forward price-to-earnings (P/E) multiple of 24. But that multiple could worsen, especially if Reality Labs (and now Threads) weigh down its earnings. Trading near its 52-week high, Meta is another stock that I would be concerned may plateau soon; investors shouldn't rush out to buy shares of the tech company.

3. Carnival

At 136%, Carnival's gains are just behind Meta's this year. The cruise ship company has been breaking records as travel demand is back. This year, the company projects occupancy levels of 100% or higher. And for the period ending May 31, revenue of $4.9 billion (a record for the second quarter) was more than double the $2.4 billion that Carnival reported in the prior-year period.

Although there's uncertainty in the economy, Carnival's business is much more predictable than most; the company estimates that at any given time, roughly half of its demand over the next 12 months is already booked. And approximately 55% of its guests are repeat customers. Now that travel is back to normal, the business is in great shape.

Carnival posted a narrow operating profit of $120 million last quarter but it's a step in the right direction as the company has posted losses over the past few years due to lockdowns and travel restrictions. Its forward P/E multiple of 132 is high but I'm optimistic that will come down as its earnings continue to recover. Shares of Carnival are still down more than 50% from where they were in early 2020 (above $50).

While there's some risk with the business given the macroeconomic challenges ahead, this is the only stock on this list I'd consider buying right now as there still could be much more upside for Carnival in both the short and long terms.