Paul Harris, CFA Microsoft Corp MSFT-Q BUY Feb 24, 2025

One of the Magnificent 3 he owns out of the Mag 7. Likes the secular opportunity in cloud computing via Azure, plus entrenched dominance in business and household applications. Stalwart grower, undemanding valuation.

He's selling a March covered call, $420 strike, and expiring March 21.

They have lots of cash and downside protection; their office products are monopolistic. Also, growth comes from gen AI and the cloud. Is a defensive play. Yes, they had a period of dead money, but the price is now attractive.

You're buying this at a lower multiple as recently as January. If you think earnings will hold up as well as AI and data centre spending, this makes sense.

Priced well now. They will and are participate in AI. A great operator.

People are taking profits in the Mag 7. Still a top pick. AI-cloud dominance and smart investments are driving their growth. Financial strength keeps them steady in uncertain markets. Her price target is $480, another 25% upside. You could add to your position now.

MSFT is phasing out Windows 10 and pushing the 11 upgrade.

Its AI platform isn't that impressive, and MSFT has missed estimates 3 times now. It will stay a dog if it misses again.

Shares are back to July 2024. Will this be closer to $300 or $500? The easy answer is $500. $300 would mean a lot of fundamental concerns on the macro side of the market. Look for guidance ahead. Are they still on schedule to spend $13 billion this year? And what will they get in return for that? Their last Q4 revealed that their AI business surprisingly surpassed their revenue run rate of $13 billion, which was a lot sooner. Companies like this are spending alot, but they are making money back in AI.