We recently published a list of 11 Best Predictive Analytics Stocks to Buy According to Analysts. In this article, we are going to take a look at where Microsoft Corporation (NASDAQ:MSFT) stands against other best predictive analytics stocks to buy according to analysts.
Predictive analytics, sometimes called big data analytics, is an integral part of today’s corporate arsenal. It is a subset of advanced analytics that makes use of statistical algorithms and machine learning techniques to predict future occurrences and gain insights from previous data. In addition, it includes tools and processes such as data mining and modeling, all aimed at examining data, identifying trends, and making informed predictions. According to Fortune Business Insights, the global predictive analytics industry was valued at $14.71 billion in 2023, and is predicted to reach $95.3 billion by 2032, with a compound annual growth rate (CAGR) of 23.1%.
Companies are always looking for ways to stay ahead of the competition and make smart choices that lead to success. This has led to a growing reliance on data-driven decisions. With consolidated analytics, machine learning models, and AI technologies, it’s now possible to analyze more companies in a larger area range at a faster rate than ever before. This is especially true for the practice of venture capitalism. Many early-stage startup investors use data-driven decision-making to guide their lead sourcing and investments. While the instinct for scouting great investment opportunities is typically developed over years of experience, venture capital firms and associates can improve their scouting process by analyzing a variety of ecosystems. According to a data-driven VC analysis, by this year, data, analytics, and artificial intelligence would be used to guide investment decisions in 75% of all VC deals. This access to high-quality data reduces venture capitalists’ risk of losing out on opportunities and assists them in identifying high-potential firms that might otherwise go undiscovered. Moreover, the combination of predictive analytics with artificial intelligence has resulted in a significant improvement in the depth of data insights. According to a Fortune Business Insights report on the AI sector, it is predicted to grow rapidly, with a CAGR of 29.2%. This rise is expected to bring the industry’s size to $1.7 trillion by 2032, a significant increase from the $233.46 billion in 2024.
Predictive Analytics in Healthcare
Much like many other industries, predictive analytics can be a boon for the healthcare sector. Due to its data-driven approach, it offers the potential to improve preventative care, resource management, and operational efficiency. In this perspective, the global healthcare predictive analytics market was valued at $12.96 billion in 2023 and is expected to rise at a compound yearly growth rate of 35% between 2024 and 2032. Furthermore, the growing volume of healthcare data from numerous sources, including wearable devices, mobile health applications, and electronic health records (EHRs), creates new opportunities for sophisticated analytics solutions. To illustrate this, the World Economic Forum estimates that hospitals create 50 petabytes of data every year.
Our Methodology
To come up with our list of the 11 best predictive analytics stocks to buy, we went through a variety of online publications, ETFs, and stock screeners. We then looked at the analyst upside of each company and ranked the ones with the highest upside potential. Our ranking is arranged in ascending order of analyst upside as of March 10, 2025. Additionally, we have included the hedge fund sentiment around each stock, as of Q4 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A development team working together to create the next version of Windows.
Microsoft Corporation (NASDAQ:MSFT)
Analysts’ Upside: 29.04%
Number of Hedge Fund Holders: 317
Microsoft Corporation (NASDAQ:MSFT) is an American multinational technology company headquartered in Redmond, Washington. It is best known for its software products, which include the Windows operating system, the Microsoft 365 suite of office apps, and the Edge web browser. The company is heavily involved in Big Data analytics with Azure Synapse Analytics, which provides a cloud data warehouse designed for enterprise business intelligence (BI) and analytics on large datasets.
Microsoft Corporation (NASDAQ:MSFT) reported notable Q2 FY25 earnings on account of ongoing growth in cloud and AI services. The company’s revenue came in at $69.6 billion, up 12% year-over-year, while operating income increased 17% to $31.7 billion. Microsoft’s net income also grew 10% to $24.1 billion, with diluted EPS reaching $3.23.
On January 30, RBC Capital Markets reiterated its Outperform rating for the MSFT stock, with a $500 price target. The firm recently announced its software industry estimate for 2025, and chose Microsoft Corporation (NASDAQ:MSFT) for its broad market exposure and ability to profit from generative AI.
Bretton Fund stated the following regarding Microsoft Corporation (NASDAQ:MSFT) in its Q4 2024 investor letter:
“Microsoft Corporation (NASDAQ:MSFT) has become the go-to provider of computing services for many emerging AI companies, and its franchise is much more diversified than Alphabet’s, making it a net beneficiary of the AI arms race. Demand for its cloud computing services continued to grow, and the rest of its business (Orce, Windows, Xbox, GitHub, LinkedIn) are also thriving, sending earnings per share up 22% while the stock returned 13%.”
Overall, MSFT ranks 5th on our list of best predictive analytics stocks to buy according to analysts. While we acknowledge the potential of MSFT as an investment, our conviction lies in the belief that certain AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than MSFT but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
