Is it Still a Wise Move to Buy Microsoft (MSFT) Shares?

Parnassus Investments, an investment management firm that focuses on owning a concentrated portfolio of U.S. large cap stocks, released its Parnassus Value Equity Fund second-quarter 2025 investor letter. The full letter is available for download here. For the second quarter of 2025, the fund reported a net return of 7.24%, outperforming its benchmark, the Russell 1000 Value Index, which returned 3.79% for the same period. The fund’s top 5 holdings are also listed in the letter, showing the firm’s main investment positions heading into 2025.

One of the companies mentioned in the letter is Microsoft Corporation (NASDAQ:MSFT). Microsoft Corporation (NASDAQ:MSFT) was founded in 1975 and is headquartered in Redmond, Washington. It develops and supports software, services, devices, and solutions. Over the past month, Microsoft Corporation (NASDAQ:MSFT) rose by 4.37%, and it gained 22.52% over the last 12 months. On July 29, 2025, Microsoft Corporation (NASDAQ:MSFT) shares closed at $512.57, with a market capitalization of $3.81 trillion.

Here is what they have to say about Microsoft Corporation (NASDAQ:MSFT) in their investor letter:

"Microsoft Corporation (NASDAQ:MSFT) rose after the firm reported strong quarterly results. Additionally, investors have shown optimism for the growth trajectory of the company’s Azure cloud computing platform in the remainder of 2025 and beyond."

Microsoft Corporation (NASDAQ:MSFT) ranks 2nd in our list of the 30 most popular stocks among hedge funds. According to our data, 284 hedge fund portfolios held positions in Microsoft Corporation (NASDAQ:MSFT)  at the end of the first quarter of 2025, down from 317 in the previous quarter. Microsoft Corporation (NASDAQ:MSFT) reported Q3 2025 EPS of $3.46, exceeding analyst expectations of $3.22. While we acknowledge the potential of ORCL as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

Microsoft Corporation (NASDAQ:MSFT) ranks 2nd in our list of the 30 most popular stocks among hedge funds. According to our data, 284 hedge fund portfolios held positions in Microsoft Corporation (NASDAQ:MSFT) at the end of the first quarter of 2025, down from 317 in the previous quarter. Microsoft Corporation (NASDAQ:MSFT) reported Q3 2025 EPS of $3.46, exceeding analyst expectations of $3.22. While we acknowledge the risk and potential of ORCL as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than ORCL and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered Microsoft Corporation (NASDAQ:MSFT) and shared Barclays analyst Raimo Lenschow’s views on the company. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.