Why Microsoft Stock Could Be Your Ticket to Becoming an AI Millionaire – TradingView News

Microsoft MSFT has consistently outperformed the market, tripling its share price in five years. Analysts rate this purchase as strong, forecasting a 12% upside in Microsoft’s stock price with a top price target set at $600. If Microsoft manages to achieve this goal, it could mean that the company’s shares could rise another 35% from then on.

Let’s dig deeper into the case for Microsoft and why this company may be able to make more millionaires in the future.

Still the most valuable company

Microsoft still competes with companies like Apple AAPL has long been in the running for the title of the most valuable company in the world in terms of market capitalization. Most recently Nvidia NVDA has emerged as a contender for this spot, recently passing both companies to take the crown.

However, as of this writing, Microsoft has returned to the top spot as investors focus on Microsoft’s fundamentals and relative growth prospects. The company’s 17% revenue growth in the third quarter and 20% year-over-year net profit growth certainly doesn’t match Nvidia’s growth rate.

However, Microsoft is working with a much larger base and current cash flows are much higher. On that basis alone, I think Microsoft probably deserves the top spot, at least for now.

Companies like Nvidia have a lot to prove. And while other cash cows like Apple will continue to nip at Microsoft’s heels, I predict that Microsoft will likely end the year as the world’s most valuable company, unless there is some additional growth in the last half of the year.

All about innovation

Microsoft’s history of innovation in the world of software and productivity is well known. However, the company’s early move towards implementing artificial intelligence through investments in key companies such as OpenAI opened the eyes of many investors to how accurately the company assessed future trends.

The company is leveraging this partnership by integrating artificial intelligence technology with Copilot AI technology. The company plans to integrate Copilot AI into its product suite, further expanding its reach in a space it already dominates.

Given Microsoft’s gross margin of 70% and projected earnings per share of $11.77, any additional benefits from this integration are likely to be received very positively by Wall Street.

The company can already benefit greatly from its investment in OpenAI, reaping most of the profits until Microsoft recoupes its initial investment. So, investors can get a double benefit from this initial investment at an early stage.

Work Trends Index for Artificial Intelligence in the Workplace

In other MSFT news, Microsoft and LinkedIn have released their 2024 Work Trends Index, highlighting the growing role of artificial intelligence in the workplace. The report, based on data from 31,000 users in 31 countries, shows that the use of artificial intelligence at work has almost doubled in six months.

Many leaders are now prioritizing hiring candidates with AI skills, but concerns remain about the lack of a clear vision for AI. As employees adopt their own AI tools, companies are challenged to move from experimentation to achieving measurable business impact.

The study found that 92% of Thai knowledge workers use AI at work, higher than the global average of 75%. This “Bring Your Own AI” trend threatens strategic benefits and data security. Driven by heavy workloads, 91% of Thai leaders see AI as critical to competitiveness, but 64% are concerned about the lack of a clear implementation plan.

Powerful AI users demonstrate unique usage patterns, reorienting their workday and saving an average of 30 minutes a day.

In Thailand, 86% start and end their day with AI, but only 45% experiment with AI in new scenarios, lower than the global average of 68%. In addition, only 28% of Thai users receive AI updates from their teams and only 22% receive AI training, below the global averages of 40% and 42%, respectively.

Bottom line on Microsoft stock

There are simply a few better AI games on the market right now. Beyond Microsoft’s significant AI investment and product integration, the company remains a cloud giant.

Its core software business will deliver consistent and growing cash flow over time. So even if this whole AI thing turns out to be a snap decision, it’s a stock worth owning for the long term. I really like this combination.

As of the date of publication, Chris MacDonald did not hold (directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the author and are subject to InvestorPlace.com’s Editorial Guidelines.

Chris MacDonald’s passion for investing led him to pursue an MBA in Finance and over the past 15 years he has taken on a number of leadership positions in corporate finance and venture capital. His past experience as a financial analyst, combined with his zeal for identifying undervalued growth opportunities, contributes to his conservative, long-term investment perspective.