Top 10 Latest AI Stock News and Analyst Ratings

2. Microsoft Corp (NASDAQ:MSFT)

Number of Hedge Fund Investors: 293

Brent Thill, Jefferies tech research analyst, while talking on CNBC about AI companies, said that of all AI companies, Microsoft Corporation (NASDAQ:MSFT) is best positioned to begin monetizing AI. The analyst thinks companies are still “years” away from making money from AI.

“The ramp really begins in 2025, 2026. Microsoft is leading that pack. We think they are in a phenomenal position. It could be a low single-digit percent of their total revenue stream this year and grow going forward,” Thill said.

Thill also said in a separate interview that Microsoft is in “great shape” with its “Copilot strategy” for the back half of 2024.

Dan Ives of Wedbush also believes MSFT is one of the leaders in the AI enterprise segment.

New Street Research started covering the stock with a Buy rating. The firm said that Microsoft Corp (NASDAQ:MSFT) is well positioned to grow profit in the “low teens for years to come” even if the AI revolution fails to pan out. New Street Research has a $570 price target on Microsoft Corp (NASDAQ:MSFT).

Analysts believe Microsoft Corp’s (NASDAQ:MSFT) AI ecosystem around its products would strengthen its Cloud division thanks to Microsoft Corp’s (NASDAQ:MSFT) integration of AI into its Cloud products. Microsoft Corp’s (NASDAQ:MSFT) Intelligent Cloud segment’s profit in the latest quarter totaled $12.51 billion, a whopping 32% growth on a YoY basis.

Microsoft Corp’s (NASDAQ:MSFT) huge investments to revive its Search business are also working. Bing’s market share has jumped to 3.64% as of April 2024, a 0.88 points gain on a YoY basis.

Wall Street expects Microsoft Corp’s (NASDAQ:MSFT) earnings to grow 12.50% next year. The  stock’s forward P/E of 31 based on 2025 EPS makes it look attractive at the current levels.

Polen Focus Growth Strategy stated the following regarding Microsoft Corporation (NASDAQ:MSFT) in its Q2 2024 investor letter:

“The top absolute contributors were Alphabet, Microsoft Corporation (NASDAQ:MSFT), and Amazon. Microsoft was another top absolute contributor in the quarter, speaking to a growing appreciation for all the ways the company has an opportunity to monetize GenAI, be it in its Office suite or Azure cloud business. In the latter case, it contributed 7% to Azure’s revenue growth in the most recent quarter. We believe Microsoft remains a highly advantaged business with many secular tailwinds driving durable growth for the foreseeable future, even at its immense scale.”