Top Analyst Views Microsoft Stock (MSFT) as a ‘Key Beneficiary of AI Adoption'
Joel Fishbein, a top analyst from Truist Securities, views tech giant Microsoft (MSFT) as a 'key beneficiary of AI [artificial intelligence] adoption,' due to the company's partnership with ChatGPT-maker OpenAI. The 5-star analyst reiterated a Buy rating on MSFT stock with a price target of $600, which indicates 23.5% upside potential from the current levels. Microsoft stock has risen 15.3% year-to-date.
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Fishbein's bullish comments follow recent reports that Microsoft was considering halting its discussions with OpenAI on some vital issues, including the size of its future stake in the AI startup. OpenAI needs Microsoft's approval to transition into a for-profit structure. Reportedly, MSFT's existing commercial contract gives it access to OpenAI's technology until 2030.
Let's look at other reasons supporting Fishbein's Buy rating on Microsoft stock.
Truist Analyst Is Bullish on Upside in MSFT Stock
Fishbein noted that Microsoft continues to work aggressively to sustain its early lead in the enterprise AI race. The top analyst's optimism is backed by several conversations with IT buyers and Truist's proprietary survey work.
The analyst believes that Microsoft's advantage prevails across its infrastructure layer in the Azure cloud computing business and the application layer with its Copilots. Fishbein said that he sees many initiatives that will help Microsoft succeed in the AI space in both the near and long term.
Based on his positive views, Fishbein expects MSFT stock to move higher, as the 'multiple levers in their AI strategy compound gains in the financial model.'
To capture further growth, Microsoft is investing heavily in AI infrastructure. The company expects to spend $80 billion this year on building data centers to handle AI workloads.
Meanwhile, Fishbein ranks 98th among more than 9,600 analysts tracked by TipRanks. His ratings have been successful 65% of the time, with an average return per rating of 18.7% over a one-year period.
Is Microsoft Stock a Buy, Hold, or Sell?
Most analysts covering Microsoft stock are bullish due to the company's solid fundamentals, AI tailwinds, and diversified revenue streams, including productivity software, cloud computing, and gaming, among others.
With 30 Buys and five Holds, Microsoft stock scores a Strong Buy consensus rating. The average MSFT stock price target of $516.14 indicates 6.2% upside potential.
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