3. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 279
Analysts Upside Potential: 21.52%
Microsoft Corporation (NASDAQ:MSFT) is a leading technology company that develops a wide range of software, services, devices, and solutions. Its offerings span several segments, including Productivity and Business Processes, Intelligent Cloud, and More Personal Computing.
The company is renowned for Microsoft Teams when it comes to video conferencing. The platform not only allows users to host meetings from anywhere, supporting both in-person and remote participants but also supports breakout rooms for smaller group discussions. Teams can accommodate up to 300 participants in a single meeting, with advanced plans allowing for webinars with up to 10,000 attendees.
In addition to basic video conferencing capabilities, Microsoft Teams integrates seamlessly with other Microsoft 365 applications including Word, Excel, and PowerPoint. This integration allows users to share files easily during meetings and collaborate in real-time on documents.
Microsoft Corporation (NASDAQ:MSFT) released its first-quarter results for fiscal 2025 on October 30 indicating top-line growth of 16% and bottom-line growth of 11%, year-over-year. The Productivity and Business Processes segment which operates Microsoft 365 commercial products and Microsoft Teams was one of the major contributors to revenue growth. The segment revenue for the quarter was $28.3 billion, up 12% year-over-year.
Microsoft Corporation (NASDAQ:MSFT) is one of the best video conferencing stocks to buy according to analysts.
Baron Opportunity Fund stated the following regarding Microsoft Corporation (NASDAQ:MSFT) in its Q3 2024 investor letter:
“Microsoft Corporation (NASDAQ:MSFT) is the world’s largest software and cloud computing company. Microsoft was traditionally known for its Windows and Office products, but over the last five years it has built a $147 billion run-rate cloud business, including its Azure cloud infrastructure service and its Office 365 and Dynamics 365 cloud-delivered applications. Shares gave back some gains from strong performance over the first half of this year. For the fourth quarter of fiscal year 2024, Microsoft reported a strong quarter with total revenue growing 16%, in line with the Street; Microsoft Cloud up 22%; Azure up 30%; 43% operating income margins; and 36% free cash flow margins. Core Azure growth came in one point shy of expectations, however, due to a soft European market and continued constraints on AI compute capacity. In the same vein, while Microsoft reiterated its fiscal 2025 targets of double-digit top-line and operating income growth, quarterly guidance called for Azure growth to slow a bit before accelerating in the back half of the fiscal year, as capital expenditures increase, yielding an expansion of AI compute capacity. We believe this investment is a leading indicator for growth, with more than half of the spend related to durable land and data center build outs, which should monetize over the next 15-plus years. We remain confident that Microsoft is one of the best-positioned companies across the overlapping software, cloud computing, and AI landscapes, and we remain investors.”
