AI ‘Shining Moment' Leads Wedbush to Boost Microsoft Price Target to $600
Wedbush's Daniel Ives raised Microsoft's (MSFT) price target to $600 from $515, which implies 21.9% upside potential from current levels. The top analyst maintained his Buy rating on MSFT and described the artificial intelligence (AI) cloud revolution as Microsoft's 'shining moment.' Ives believes that fellow Wall Street analysts are not fully appreciating Microsoft's growth story, but Wedbush is becoming 'incrementally bullish' on the company.
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Ives cited conversations with customers and partners and determined that, over the next three years, roughly 70% of a company's installed base will include Copilot and Microsoft AI tools. This data suggests an inflection point for Microsoft in 2026, when companies are expected to start integrating AI tools into their systems following experimentation in 2024 and 2025. MSFT stock reached a fresh 52-week high of $494.56 in mid-day trading yesterday, driven by bullish analyst views.
MSFT Copilot and Azure Adoption Are Set to Surge
Ives noted that Microsoft Copilot and Azure are set to witness a 'massive adoption wave,' which will create significant monetization opportunities for the company. According to the analyst, several companies are now focused on deploying AI use cases across multiple sectors, with government, finance services, and retail sectors emerging as 'clear standouts.'
Microsoft has recently doubled down on its AI strategy, with $80 billion in capital expenditures planned for FY25 to bolster its data center infrastructure. Despite stiff competition from hyperscalers such as Amazon's (AMZN) Amazon Web Services (AWS) and Alphabet's (GOOGL) Google Cloud Platform, Ives believes that Microsoft remains the clear front runner on the enterprise hyperscale AI front.
Wedbush also includes Microsoft on its 'Best Ideas List,' and Microsoft is also featured in the Dan IVES Wedbush AI Revolution ETF, which was launched earlier this month. As of date, MSFT is the third-largest holding in the ETF, with a 4.86% weight.
Is Microsoft Stock a Good Buy?
Analysts remain highly optimistic about Microsoft's long-term stock trajectory. On TipRanks, MSFT stock commands a Strong Buy consensus rating based on 30 Buys and five Hold ratings. Also, the average Microsoft price target of $519.76 implies 5.6% upside potential from current levels. Year-to-date, MSFT stock has gained 17.3%.
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