Barclays Raises PT on Microsoft Corporation (MSFT) to $625; Maintains 'Overweight' Rating

With strong share price gains and significant hedge fund interest, Microsoft Corporation (NASDAQ:MSFT) secures a spot on our list of the 11 Hot Software Stocks to Buy Now.

On July 31, 2025, Barclays raised its price target on Microsoft Corporation (NASDAQ:MSFT) from $550 to $625, maintaining an ‘Overweight’ rating. This price revision follows the company’s strong Q4 FY25 results.

Microsoft Corporation (NASDAQ:MSFT) recorded a 3.5% revenue beat and a 7% operating profit beat, resulting in a 180-basis-point margin growth. Furthermore, over the past year, the company posted a 69.07% gross margin and 14.13% revenue growth. Its Azure platform led the charge, growing 39% YoY in constant currency, exceeding both guidance and investor expectations.

Furthermore, the investment firm highlighted the company’s dominant position in the software market, making it one of the hot stocks to buy. With expectations of continued traditional cloud migrations and the scaling of generative AI, Microsoft Corporation (NASDAQ: MSFT) offers significant upside potential.

Known for Windows, Office, and Azure platforms, Microsoft Corporation (NASDAQ:MSFT) develops and markets software, cloud services, hardware, and AI solutions.

While we acknowledge the potential of MSFT 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.

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Disclosure: None.