For years, Microsoft (NASDAQ: MSFT) has remained a steadfast blue-chip asset in the stock market, consistently generating reliable returns for investors. Its success can be attributed to its unwavering commitment to innovation and its remarkable adaptability to ever-changing market conditions.
As of July 5, Microsoft is the world’s second most-valuable company in the world, with a stock market capitalization of more than $2.5 trillion, only behind Apple (NASDAQ: AAPL) at $3.04 trillion.
Financial strategists and market experts expect Microsoft to maintain this continued uptrend, including Wedbush analyst Daniel Ives, who expects to see MSFT in the “exclusive $3 trillion club by early 2024.”
Picks for you
Ives cites increased AI spending as a game-changer
According to Ives, Microsoft should hit $3 trillion early next year. His projections are mainly due to the tech giant’s increased spending on the nascent artificial intelligence (AI) technology.
Specifically, the strategist estimates that for each $100 of Microsoft’s spending in its cloud solution Azure, “there is an incremental $35-$40 of AI spend that now is on the table which changes the game.”
Earlier this year, the maker of the Windows operating system injected a whopping $10 billion into OpenAI, an AI research lab behind ChatGPT – the fastest-growing consumer application in history.
As part of the deal, Microsoft Azure became the exclusive cloud provider for the chatbot since OpenAI uses Azure to train all of its AI models.
The tech behemoth also equipped its search engine Bing with ChatGPT’s underlying technology in February. More recently, the company announced the launch of Windows Copilot – an AI-based ‘personal assistant’ for Windows 11.
Microsoft stock price analysis
At press time, shares of MSFT were trading at $340.78, rising 0.83% at the market open on Wednesday.
The stock closed at an all-time high last month of $348.11 last month, exceeding its previous peak of $343.11 it reached in November 2021.
Year-to-date, the stock gained more than 40%, driven by the ongoing AI frenzy and the broader tech market rebound.
In June, analysts at BMO Capital Markets hiked their price target on MSFT stock to $385 per share, citing the AI’s ability to fuel the company’s incremental revenue opportunities in the coming years.
Buy stocks now with Interactive Brokers – the most advanced investment platform
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
