UBS Maintains Buy on Microsoft (MSFT), Citing Confidence from Pricing Moves

Microsoft Corp. (NASDAQ:MSFT) is one of the top stocks to buy and hold forever. Microsoft Corp. (NASDAQ:MSFT) has an unmatched market position through its dominance in operating systems, productivity software, and cloud services. Its products are deeply embedded in enterprise workflows, creating high switching costs and long-lasting customer reliance.

On August 20, a UBS analyst reaffirmed his Buy rating on Microsoft Corp. (NASDAQ:MSFT) with a price target of $650. The call followed upcoming pricing and licensing changes that take effect on November 1, which will standardize enterprise agreements and lift prices by roughly 3% to 14%, depending on customer tier.

The analyst estimates the changes will impact products that account for about 55% of revenue, including Azure, Microsoft 365, and Dynamics 365, while government and education contracts are excluded.

He also believes the pricing actions were already reflected in guidance, but still adds confidence to forecasts of 14% revenue growth in FY 2026. Microsoft Corp.’s (NASDAQ:MSFT) positioning in AI remains a key driver, with UBS describing the stock as reasonably valued given its leverage to the trend.

Microsoft Corporation (NASDAQ:MSFT) is a technology company that develops and sells software, devices, and cloud-based services for individuals and enterprises worldwide.

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. This article is originally published at Insider Monkey.