Microsoft's (MSFT) AI Strategy Reinforces Its Position as a Long-Term Winner, Analyst Says

Microsoft Corporation (NASDAQ:MSFT) is one of the AI Stocks on the Market's Radar. On January 5, Jefferies analyst Brent Thill reiterated a Buy rating on the stock with a $675.00 price target.

The firm believes that investors should remain selective in software this year, recommending an underweight position until AI monetisation becomes more visible. Jefferies top mega-cap picks are Microsoft and Meta, along with large-caps Intuit, Atlassian and Oracle.

Some of their top predictions for 2026 include strong AI tailwinds for Microsoft, a “broad-based AI resurgence” at Meta, an AWS-driven Amazon rebound and a reacceleration at Oracle.

Microsoft continues to demonstrate strength across its various businesses, and it has also been expanding its artificial intelligence capabilities and integrating AI features across its portfolio. This is seen as a significant growth driver for the stock.

Analysts on Wall Street currently have a consensus Buy rating on the stock. The average price target of $630 implies a 33.23% upside, however, the Street-high target of $730 implies an upside of 54.38%.

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.