12 AI Stocks Making Waves on Wall Street Today

2. Microsoft Corporation (NASDAQ:MSFT)

Number of Hedge Fund Holders: 317

Microsoft Corporation (NASDAQ:MSFT) provides AI-powered cloud, productivity, and business solutions, focusing on efficiency, security, and AI advancements. One of the most notable analyst calls on Tuesday, May 20, was for Microsoft Corporation. Analyst Kash Rangan reiterated his “Buy” rating on the stock and lifted his price target by $70 to $550. Rangan noted that the four-day Build conference has reinforced his confidence in the company’s artificial intelligence investments.

“We believe these investments help position Microsoft at the forefront of developer tool ecosystem (seeing some of the most promising early GenAI adoption) and help establish a robust and interoperable ecosystem for agentic AI. This will not only support consumption of AI compute on Azure, but adoption of Microsoft’s platforms and applications, all of which become richer and more dynamic with standardized, interconnected tools.”

-Rangan wrote in a Monday note to clients.

He further highlighted Microsoft’s Model Context Protocol as a “major evolution” in Microsoft’s AI ecosystem. The Protocol enables developers to integrate AI models and external systems. Moreover, Microsoft’s GitHub Copilot and Copilot Studio were pointed out as two other impressive parts of the company’s rapidly scaling AI business.

Two other catalysts are the Azure AI Foundry platform for AI agents and the focus on scaling its Azure cloud regions and data centers.

“We continue to believe that as Gen-AI moves from the Infrastructure layer to the Platform/Application layers, Microsoft is well positioned to capitalize on this shift, wherein a more capital efficient and higher margin recurring revenue model could become a reality, just as it did during the on-prem to cloud transition.”