11 Best Innovative Stocks to Buy According to Analysts

6. Microsoft Corporation (NASDAQ:MSFT)

Average analysts’ upside: 33.64%

Number of Hedge Fund Holders: 317

Microsoft Corporation (NASDAQ:MSFT) is a global technology leader that offers a complete range of software, services, and devices. Its core offerings include the Windows operating system, productivity and collaboration software (Office suite), cloud platforms, enterprise solutions, development tools, and devices like Surface PCs and Xbox consoles. The company also creates value through platforms like Microsoft 365, Azure, LinkedIn, and GitHub, which have become leaders in their niches. MSFT’s innovation is centered on creating AI responsibly, unlocking next-generation tools that make humans more productive, secure, and efficient.

Microsoft Corporation (NASDAQ:MSFT) delivered strong financial results in the most recent Q2 2025, with revenue growing 12% and operating income increasing 17% YoY. The Microsoft Cloud remains the key pillar of growth as it surpassed $40 billion in quarterly revenue for the first time, up 21% on a YoY basis. Notably, the company’s AI business reached an annual revenue run rate of $13 billion, growing 175% compared to the previous year. Commercial bookings increased significantly by 67% YoY, driven largely by Azure commitments from its promising partner OpenAI.

Microsoft Corporation (NASDAQ:MSFT) is seeing accelerated adoption of its AI offerings, particularly Microsoft 365 Copilot, across various customer segments. The company is expanding its data center capacity to meet the growing demand for AI and cloud services, having more than doubled its overall capacity in the last 3 years. MSFT is also focusing on optimizing its AI infrastructure for both training and inference, which is expected to drive down costs and increase the accessibility of AI technologies. Looking ahead, management anticipates continued strong demand for its cloud and AI offerings, with plans to further scale its global infrastructure to support long-term growth. The tremendous growth momentum and constant improvements in its core products solidifies MSFT’s position as one of the best innovative stocks to buy.