10 Unrivaled Stocks of the Next 5 Years

2. Microsoft Corporation (NASDAQ:MSFT)

Number of Hedge Fund Holders: 279

Microsoft Corporation (NASDAQ:MSFT) is a leading developer of computer software, operating systems, artificial intelligence (AI, and cloud computing. The company’s early investment in OpenAI has allowed it to enhance its cloud computing services (Azure) and position itself as a leader in the rapidly growing field of generative AI. Microsoft Corporation (NASDAQ:MSFT) ranks among the top unrivaled stocks of the next 5 years.

RiverPark Advisors, an investment advisory firm, discussed Microsoft Corporation (NASDAQ:MSFT) in its “RiverPark Large Growth Fund” third quarter 2024 investor letter. The letter noted that MSFT reported strong revenue and earnings growth in its fiscal fourth quarter of 2024, driven by Azure and operating margins. However, the guidance anticipated lower-than-expected Azure revenue in its fiscal first quarter of 2025 because of infrastructure constraints. Microsoft Corporation (NASDAQ:MSFT) expects to reaccelerate growth in the second half of fiscal 2025 as more AI capacity comes online.

The investor letter also noted that cloud-based services are now Microsoft Corporation’s (NASDAQ:MSFT) largest revenue and earnings-generating segment. RiverPark Advisors believes that the company’s Azure platform has the potential to grow to over $200 billion in annual revenue over the next decade. The investment advisory firm expects Microsoft Corporation (NASDAQ:MSFT) to continue to deliver double-digit revenue and EPS growth and generate substantial free cash flow to return to shareholders and use for acquisitions.