Microsoft Seen With 30% Upside in 2026 as AI Growth Accelerates

This article first appeared on GuruFocus.

Microsoft (MSFT, Financials) to rise 30% in 2026 due to its AI and cloud divisions. Analysts rate the stock Strong Buy, and shares have risen 17% this year, outperforming Meta and Apple. Out of 34 recommendations, 32 are Buys and two are Holds, with an average price target of $631.36 a 29.6% upside.Microsoft’s fiscal first quarter 2026 sales rose 18% to $78 billion, led by a 40% increase in Azure and associated cloud services. With a 27% investment in OpenAI worth $135 billion, the corporation has strengthened its corporate technology leadership.As Microsoft grows its AI infrastructure, capital outlays increased to $34.9 billion, worrying investors. Wedbush analyst Dan Ives termed the business a core winner among AI equities and expects sustained outperformance as corporations use AI.Other analysts are mostly positive. Julian Emanuel of Evercore ISI said AI bubble worries are largely absent, noting prominent tech corporations’ solid…