Microsoft Corporation (MSFT) Set to Gain from Rising Software Spending, Morgan Stanley Says

Microsoft Corporation (NASDAQ:MSFT) is among the most profitable US stocks to buy. On January 14, Morgan Stanley maintained an ‘Overweight’ rating on Microsoft Corporation (NASDAQ:MSFT), keeping an unchanged price target of $650. This reaffirmation, suggesting an upside potential of nearly 38%, follows its fourth-quarter 2025 CIO Survey.

While indicating favorable software spending plans, the survey outlined expectations of software spending growth to increase by 9 basis points YoY, from 3.7% in 2025 to 3.8% in 2026. That said, Microsoft Corporation (NASDAQ:MSFT) is poised to benefit from this strengthening environment as CIOs anticipate 7.3% growth for the company in 2026, 100 basis points higher than the second-quarter 2025 survey.

What’s even more interesting is that Microsoft Azure continues to win the support of CIOs, with it being the most preferred public cloud vendor as it hosts an impressive 53% of application workloads. The survey highlights that the business is projected to maintain this position over the upcoming three years, thanks to the acceleration of broader public cloud adoption.

Overall, Microsoft Corporation (NASDAQ:MSFT) is a consensus Buy, with nearly all analysts covering the stock assigning a Buy or equivalent rating. With a median price target of $631, the stock has an upside potential of 34.06%.

Microsoft Corporation (NASDAQ:MSFT) is a Washington-based company operating through Productivity and Business Processes, Intelligent Cloud, and Personal Computing segments. Founded in 1975, the company provides software, services, devices, and solutions worldwide.

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Disclosure: None.