Microsoft (MSFT) Rated Overweight at Morgan Stanley Amid Strong Azure AI Demand

Microsoft Corporation (NASDAQ:MSFT) is one of the AI Stocks Analysts Are Watching Closely. On October 16, Morgan Stanley reiterated the stock as “Overweight” and said that Microsoft is a “core holding.”

According to the firm, the company reported robust Q4 results and strong demand for Azure AI. However, there are concerns about OpenAI’s relationship and whether Azure’s growth can continue long-term.

“Despite strong Q4 results and robust demand for Azure AI, lurking questions on the OpenAI relationship and the durability of Azure growth keep shares off highs.”

Analysts on Wall Street currently have a consensus “Buy” rating on the stock. The average price target of $630.00 implies a 22.7% upside, however, the Street-high target of $710 implies an upside of 38.3%.

Microsoft Corporation (NASDAQ:MSFT) provides AI-powered cloud, productivity, and business solutions, focusing on efficiency, security, and AI advancements.

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.