1. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 300
Topping our list of the 10 stocks hedge funds are talking about is Microsoft Corporation (NASDAQ:MSFT). Microsoft Corporation (NASDAQ:MSFT) delivered a 54.22% return since the beginning of the year, achieving a new record high of $376.17 on November 16, 2023. With shares surging over 11% in the past month, Microsoft Corporation (NASDAQ:MSFT) now boasts a market cap of $2.74 trillion. Investor confidence has been bolstered by the company’s recent quarterly results, indicating better-than-expected growth in its Azure cloud unit and a decrease in interest rates.
According to our analysis, Microsoft Corporation (NASDAQ:MSFT) holds the top position in our compilation of the 30 Most Popular Stocks Among Hedge Funds. As of the end of the second quarter of 2023, Microsoft Corporation (NASDAQ:MSFT) was present in 300 hedge fund portfolios, marking an increase from 289 funds in the preceding quarter. The Bill & Melinda Gates Foundation Trust emerges as the leading hedge fund holder of Microsoft Corporation (NASDAQ:MSFT) with 39.2 million shares, valued at $12.4 billion.
Alger Spectra Fund made the following comment about Microsoft Corporation (NASDAQ:MSFT) in its Q3 2023 investor letter:
“Microsoft Corporation (NASDAQ:MSFT) is a beneficiary of corporate America’s transformative digitization. Microsoft’s CEO expects technology spending as a percent of Gross Domestic Product (GDP) to jump from about 5% now to 10% in 10 years and that Microsoft will continue to capture market share within the technology sector. The t 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 period, the company reported fiscal fourth quarter results that were slightly below expectations. This was largely because anticipations were high due to the company’s robust year-to-date share price performance, which was buoyed by enthusiasm surrounding Al. Although quarterly revenues and earnings beat consensus estimates, management pointed out that they would be ramping up capital expenditures to support Al-driven operational growth. Notably, the company witnessed significant growth in its Intelligent Cloud segment as Azure continues to expand its market share. Despite the encouraging results, demand challenges stemming from companies looking to optimize their cloud spending led to a deceleration in cloud growth when compared to the previous quarter. Acknowledging that cloud optimization may curb the company’s growth in the short term: we remain confident about the company’s prospects going forward, particularly in the realm of Al adoption. Further, CEO Satya Nadella has recently indicated that substantial revenue contributions from Al will begin to materialize around the first half of 2024.”
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