1. Microsoft Corporation (NASDAQ:MSFT)
Number of Billionaire Investors: 34
Microsoft Corporation (NASDAQ:MSFT) is a tech giant renowned for its popular software offerings, including Windows and Office, as well as being a key player in cloud computing through Microsoft Azure. Additionally, the tech giant has invested billions in OpenAI, the creator of ChatGPT, and has integrated AI across many of its products.
In fiscal Q4 2024, Microsoft Corporation (NASDAQ:MSFT) reported $64.7 billion in revenue, a 15% increase year-over-year. Net income rose 10% YoY to $22 billion. A major driver of this growth is Microsoft Azure, which has benefitted from AI integrations. With a 31% market share, Azure is poised to generate substantial value amid strong demand for cloud solutions.
Mizuho recently reiterated its positive outlook on Microsoft Corporation (NASDAQ:MSFT), maintaining an Outperform rating and a price target of $480. The endorsement followed Microsoft’s announcement of a new $60 billion share buyback program, matching the previous plan set three years ago. The company also raised its quarterly dividend by nearly 11%, continuing a six-year trend of dividend growth.
Microsoft Corporation (NASDAQ:MSFT) tops the list of the 10 best stocks to buy, with 34 billionaires holding stakes in the company as of the June 2024 quarter.
Alger Spectra Fund stated the following regarding Microsoft Corporation (NASDAQ:MSFT) in its Q2 2024 investor letter:
“Microsoft Corporation (NASDAQ:MSFT) is a beneficiary of corporate America’s transformative digitization. The company operates through three segments: Productivity and Business Processes (Office, LinkedIn, and Dynamics), Intelligent Cloud (Server Products and Cloud Services, Azure, and Enterprise Services), and More Personal Computing (Windows, Devices, Gaming, and Search). During the quarter, shares contributed to performance after the company reported strong fiscal third quarter results, underscoring its leadership position in the cloud and highlighted its role as a primary facilitator and beneficiary of AI adoption. Company revenue growth, operating margin, and earnings growth surpassed consensus expectations. The utility scale Azure cloud business grew 31% in constant currency of which 7% was AI related versus 3% two quarters ago. Further, management noted most of the AI revenue continues to stem from inference rather than training indicating high quality AI applications by Microsoft’s clients. Management also indicated that the significant cost-cutting programs in corporate America are done, suggesting that the cost optimization headwinds previously impacting Azure’s growth are over. Separately, management provided color on their new AI-productivity tool, Copilot, noting that approximately 60% of Fortune 500 companies are already using Copilot, and that the quarter witnessed a 50% increase in Copilot assistance integration within Teams. We continue to believe that Microsoft has the potential to hold a leading position in AI, given its innovative approach and demonstrated high unit volume growth opportunity.”
While the best stocks according to billionaires are companies with solid potential, we at Insider Monkey believe that there are under-the-radar AI stocks trading at highly discounted valuations that hold greater promise for anyone looking to diversify their portfolio. If you are looking for an AI stock that is more promising than MSFT, check out our report about the cheapest AI stock.
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