Banana3
Professional Trader/Investor, Real Estate Developer, 25 Years’ Experience
Microsoft is a toll booth for AI, so the bearish story around it is overdone. Enterprise switching costs make leaving Microsoft impractical, Azure offers a full AI-native stack, and it has half a trillion dollars in backlog; the stock should reach $410 soon. Amazon remains the preferred pick. A post the author replies to calls it death by Claude, and another flags its worst Q1 since 2008 and $146 billion of cash-burning capex. x.com x.com
Microsoft's 50% Azure growth and prospect of positive cash flow in 2027 make the stock look bulletproof. Headcount cuts, lower Anthropic spend, a better Copilot routed to cheaper tokens, and coming proprietary chips and model usage add to the case. It should get Apple's multiple plus recognition for cybersecurity. x.com x.com
Anthropic's S-1 and @UncleAlpha007's claim that Microsoft is growing despite a 27% headcount cut have turned the near-term tech-equity view bullish. At least a tradable rally is expected; further upside depends on Iran developments and PCE. Stay nimble. x.com x.com
Microsoft is cheap but not a long-term holding, because it is not growing fast enough while Nvidia is cheaper, growing much faster and better positioned. Microsoft may be re-rating, but the backdrop could also push it to a 15x P/E, so for now it is only a tradable situation. x.com
Azure's accelerating growth and better returns per capex dollar leave further upside on the table for Microsoft, the favored hyperscaler. Azure grew 48% versus 44-45% guidance, its fifth straight beat. The stock is holding eight-week EMA support, with the blue candle still intact. x.com
Microsoft's salesforce and governed platform unlock AI spending at conservative firms. Faster enterprise than consumer AI adoption makes it effectively the only pure play. M365 Commercial may top 20% growth next quarter, sooner than expected on tonight's guide; GitHub resegmentation helps, but it should do so this year anyway. Azure and M365, two-thirds of revenue, should grow above 50% and 20% and may accelerate. $24-25 CY27 EPS remains achievable, implying under 22x forward earnings. x.com … Show more
Microsoft is a secular loser trading at a high multiple, a profile that struggles in this market. It finished red on a day the Dow rose over 1,000 points. x.com
Rapid revenue growth makes the capex bear case harder to justify for Microsoft, Alphabet, Meta and Amazon. Their latest cited growth rates are 18%, 23%, 28% and 16% in Q2, respectively; their scale does not seem to be slowing them as expected. x.com
Microsoft is one of the only good values left in tech, while names such as Snowflake, Rubrik, Samsara and MongoDB look far too bubbly. If the stock simply returns to its highs, the gains are straightforward. x.com
Microsoft and software stocks broadly still look expensive, because AI will get exponentially better over the next two years and the market may reset software valuations much lower. Software valuations have always been ludicrous, and heavy stock-based compensation behind many software revenues is widely ignored. Winners will emerge, but picking them is not worth trying. x.com x.com
Microsoft and Meta look like great value here; even in an over-exuberant market there are still plenty of opportunities. Morningstar says the tech sector offers unparalleled value, a call that is at least somewhat right. x.com