Institutions Adopt Sandisk's Index Strategy to Increase AI Stock Investments

AI Stocks Attract Strategic Investors Ahead of Key Exchange Listings

Astute investors are steadily building positions in companies focused on artificial intelligence, anticipating that upcoming major exchange listings could spark significant market activity. This approach draws inspiration from recent trends in the semiconductor and enterprise software industries, where institutional buying and market mechanics have played a pivotal role.

One notable example is Sandisk Corporation (NASDAQ:SNDK), which experienced a dramatic 530% surge in 2025 after being added to the S&P 500. The inclusion led to substantial inflows from passive investment vehicles such as the SPDR S&P 500 ETF Trust (SPY), demonstrating how index membership can drive institutional interest and demand.

Within the broader AI landscape, performance remains mixed. C3.ai (NYSE:AI), a leading enterprise AI company, recently rebounded by 6% after suffering a 60% drop over the past year. This modest recovery reflects a cautious optimism among analysts, with UBS assigning a $17 price target—representing a potential 25.74% gain from its recent $13.63 close. Valuation models estimate a fair value of $14.67, suggesting the stock may be slightly undervalued. However, C3.ai faces ongoing challenges, including a price-to-sales ratio of 5—higher than many peers—and concerns over declining revenues and dependence on key partnerships.

Market sentiment remains wary, as evidenced by options data showing implied volatility at 88.99 and a 50% chance of price swings exceeding 12.63% ahead of the company’s December 3 earnings announcement.

Institutional Moves Highlight Broader Tech Opportunities

Large investors are also making calculated moves in tech stocks linked to AI. Salesforce (NYSE:CRM), while not exclusively an AI company, has seen notable purchases from firms such as J.W. Cole Advisors, reflecting confidence in the technology sector’s durability. Salesforce’s recent earnings outperformance and new dividend have further enhanced its attractiveness, with analysts setting an average price target of $323.51. Similarly, Sandisk’s addition to the S&P 500 has attracted attention from index-tracking funds, as shown by its 13% rally following the announcement. These developments indicate that investors are seeking both direct and indirect exposure to AI’s growth potential within the broader technology ecosystem.

Technical Signals and Market Sentiment

C3.ai’s technical indicators present a complex picture. While the Relative Strength Index (RSI) is approaching overbought levels, the MACD continues to signal bearish divergence. These factors suggest the possibility of a near-term reversal or pullback, aligning with the heightened volatility seen in the options market. Unlike previous tech booms, the current market is more cautious about AI sector valuations, even as it remains alert to the potential for rapid growth driven by index inclusions and passive investment flows.

Anticipation Builds for AI IPOs and Restructurings

Speculative buying is also increasing as investors look ahead to potential IPOs and exchange listings in the AI space. Rumors of a restructuring at OpenAI have fueled speculation about a possible public offering, which could redefine valuation standards across the sector. Meanwhile, institutional investors are boosting their stakes in companies like CoStar Group ahead of earnings, following a pattern of positioning before major announcements—a trend that may extend to AI firms approaching significant milestones.

Balancing Optimism and Caution in AI Investing

As artificial intelligence continues to reshape the market, investors are weighing the sector’s transformative promise against concerns about high valuations and execution risks. The interplay between index additions, analyst outlooks, and institutional flows—as seen with Sandisk and C3.ai—offers insight into how capital is being deployed in anticipation of AI’s next major leap. For now, the discreet accumulation of AI-related stocks signals a market ready to respond swiftly when the next breakthrough company debuts on a major exchange.