5 Best Video Conferencing Stocks to Buy

2. Microsoft Corporation (NASDAQ: MSFT)

No. of Hedge Fund Holders: 258

Microsoft Corporation (NASDAQ: MSFT) has been in the video conferencing segment since 2006 through Skype, but it also has another platform called Teams, developed as a workplace collaboration software. It is currently available in 41 countries. Teams has secured more than 40% market share in some countries such as the United Arab Emirates and Poland.

Teams is just one of the offerings from Microsoft that take advantage of the demand. Some of the other products in its portfolio include the Surface hardware lineup, through which users can access Microsoft Teams, although it is also available for non-Surface devices. Microsoft has also invested heavily in cloud computing solutions and gaming through its Xbox division. The two segments experienced significant demand during the pandemic. 

Based on our calculations, Microsoft Corporation (NASDAQ: MSFT) ranks 2nd in our list of the 30 Most Popular Stocks Among Hedge Funds.

Baron Opportunity Fund, in its Q1 2021 investor letter, mentioned Microsoft Corporation (NASDAQ: MSFT). Here is what Baron Opportunity Fund has to say about Microsoft Corporation in its letter:

“Microsoft Corporation is a cloud-software Titan, and also discussed further in the Review and Outlook section above and the Top Purchases section below. Microsoft was a top contributor in the period because it trades at reasonable FCF and earnings valuations, has cloud and digital transformation tailwinds at its back, and reported an excellent December quarter, beating Street expectations by a wide margin. Microsoft’s results were strong across the board, with accelerating trends in Azure cloud computing and solid growth in its overall commercial cloud businesses. Azure accelerated to 48% constant-currency (“cc”) revenue growth from 47% the quarter before, and commercial cloud grew 32% cc, ahead of Street estimates at 26%. Microsoft’s profitability was also a significant beat, with operating income coming it at $17.9 billion, almost $3 billion ahead of Street estimates. Microsoft’s March quarter guidance also outstripped Street projections, with revenue growth of 16.5% versus the Street at 10.6%, and operating income over $1 billion ahead. CEO Satya Nadella began the earnings call with this proclamation: “What we are witnessing is the dawn of a second wave of digital transformation sweeping every company and every industry. Digital capability is key to both resilience and growth … Microsoft is powering this shift with the world’s largest and most comprehensive cloud platform … I’m energized by our increasing momentum and the expanding opportunity fueled by the structural change brought about by the rapid adoption of digital technology.””