Billionaire Phillipe Laffont’s Top 10 “Mostly AI” Stock Picks

3. Microsoft Corp (NASDAQ:MSFT)

Barclays Venu Krishna recently indicated in its research report that mutual funds are taking interest in tech stocks like Microsoft Corp (NASDAQ:MSFT) leading to increase in shares about 30% over the past one year whereas the average estimate by analysts is a 14% upside from the current levels to $483. Microsoft Corp’s (NASDAQ:MSFT) Search business Bing’s market share jumped to 3.64% as of April 2024, gaining 0.88 points YoY basis. Wall Street in addition to New Street Research, who have initiated the coverage on the stock with a Buy rating, believe that earnings are expected to grow in the low teens for near future.

To no surprise, Bill & Melinda Gates Foundation Trust holds around 36 million shares worth $15 billion making it the largest shareholder of Microsoft Corp (NASDAQ:MSFT) in the first quarter of 2024. Coatue Management’s holding in this stock is worth $1.5 billion with 3.6 million shares.

Baron Fifth Avenue Growth Fund stated the following regarding Microsoft Corp (NASDAQ:MSFT) in its first quarter 2024 investor letter:

“Our second largest purchase during the quarter was the software platform, Microsoft Corporation (NASDAQ:MSFT), which we continued to add to, after initiating a position in the fourth quarter of 2023. Microsoft continues to report strong quarterly results, with revenue growth of 16% year-over-year in constant currency thanks to better-than-expected demand in its intelligent cloud segment, which saw revenue growth of 19% year-over-year, driven by Azure growth of 28% with AI contributing 6pts to growth compared with 3pts in the prior quarter. While the adoption of GenAI remains in its early stages, Microsoft has disclosed positive initial data points with 53,000 Azure AI customers as of its December quarter up from 18,000 in the prior quarter, 1.3 million paid GitHub Copilot subscribers (up 30% sequentially) and more than 230,000 organizations who have used AI capabilities in the power platform (up 80% sequentially). Management also noted that large cloud optimizations that started a year or so ago have largely finished. Profitability also continues to be strong with 44% non-GAAP operating margins, which was 120bps better than expected.”