Wedbush Reiterates Outperform on Microsoft (MSFT) on Azure AI Momentum

Microsoft Corporation (NASDAQ:MSFT) is one of the must-buy AI stocks to invest in. On December 22, Wedbush predicted that Microsoft Corporation (NASDAQ:MSFT) will experience massive revenue growth on the back of AI. The firm stated that the market is underestimating the scale of the opportunity heading into 2026. Analyst Dan Ives highlighted that investors are specifically underestimating the Azure growth story, and as such, Microsoft is one of Wedbush’s top picks among large tech companies.

Accordingly, Wedbush reaffirmed its Outperform rating on Microsoft stock with a $625 price target. The analysts labeled the company a “core winner” in its coverage of AI-focused firms. Ives pointed out that “investor skepticism around Microsoft’s AI growth profile has created room for upside surprises,” with the company positioned “in the sweet spot of enterprise strategic AI deployments.” He argued that the stock still has yet to price in the upcoming wave of expansion from cloud and AI services.

Five days earlier, on December 17, Morgan Stanley’s Keith Weiss stated that Microsoft is firing on all cylinders. Weiss arrived at this conclusion after direct meetings with company leaders. According to Weiss, the tech giant has strong customer demand across its businesses, which is fueling steady growth. At the same time, smart AI investments are delivering real profits and setting the stage for even fatter margins ahead. The market, Weiss argued, hasn’t fully priced in this strength. For that reason, Morgan Stanley maintained Microsoft as its Top Pick in large-cap software.

Microsoft Corporation (NASDAQ:MSFT) is a global technology leader. The company integrates AI across its core products, including Microsoft 365, Azure Cloud, and LinkedIn. It also partners with OpenAI to deliver advanced generative AI capabilities through its Copilot platform. Its Azure platform provides enterprises with scalable AI infrastructure, custom chips, and machine learning services.

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.

READ NEXT: 11 Best NYSE Stocks Under $5 to Buy and 11 Best Healthcare AI Stocks to Buy Now.

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