Top 10 Stocks Everyone Is Talking About These Days

2. Microsoft Corporation (NASDAQ:MSFT)

Number of Hedge Funds Investors: 279

Dan Niles of Niles Investment Management believes CapEx spending on Nvidia chips will slow down based on Microsoft Corp’s (NASDAQ:MSFT) outlook. Talking in a latest program on CNBC, Niles cited Microsoft’s latest statement:

“I look at what the biggest spender of AI capex is saying, which is Microsoft. One of the things that’s driving the market down today is IR from Microsoft in Australia, and they’re sort of clarifying some of the notes that came out on Friday. They’re saying, “Right, you know, we think supply and demand are going to be in balance by the end of our fiscal year, which, by the way, is June, so it’s not that far away, and we think our capex growth is going to slow to more in line with our revenue growth.” Well, capex growth is running 50 to 60%, while revenue growth is running in the mid-teens. So you look at that, and you go, “Okay, well that pretty much confirms the fact that capex is going to slow down.” So for the Nvidia print, it’s more interesting to just see what they have to say. Jensen looks out 10 years in.”

Mairs & Power Growth Fund stated the following regarding Microsoft Corporation (NASDAQ:MSFT) in its Q4 2024 investor letter:

“Unlike the dot-com companies that operated at the turn-of-the-century, many of today’s technology companies are established businesses with significant cash flows. We have argued, and continue to argue, that many of these investments are perfectly aligned with our investments process in that they embody durable competitive advantages, above-average growth prospects, and excellent management teams.

A perfect example is Microsoft Corporation (NASDAQ:MSFT), which has grown to become the largest holding in the Growth Fund. Microsoft has a near monopoly on the office software productivity market with its Microsoft Office Suite. The company’s Azure platform is a leader in cloud computing and has been steadily gaining share. Thanks to its Office and Azure products, the company is deeply embedded within many enterprise IT ecosystems. Therefore, it should be well-positioned to expand its presence within its customer base, as it rolls out premium-price AI solutions. The company is not resting on its laurels and plans on spending an astounding $80 billion in 2025 to build out AI data centers.”