14 Best Software Stocks to Buy According to Wall Street Analysts

Page 5 of 13

​9. Microsoft Corporation (NASDAQ:MSFT)

Number of Hedge Fund Holders: 312

Upside: 47.16%

​Microsoft Corporation (NASDAQ:MSFT) is one of the Best Software Stocks to Buy According to Wall Street Analysts. On January 30, Tyler Radke from Citi reiterated a Buy rating on the stock but lowered the price target from $660 to $540. Earlier, on January 29, Karl Keirstead from UBS also reiterated a Buy rating on Microsoft Corporation (NASDAQ:MSFT) with a $600 price target.

​The ratings follow the company’s fiscal Q2 2026 earnings release announced on January 28. The company grew its quarterly revenue by 16.72% year-over-year to $81.27 billion and topped the estimates by $993.68 million. Moreover, the EPS of $4.14 also topped the consensus by $0.22.

​Revenue growth was driven by a 10% increase in Productivity and Business Processes and a 21% year-over-year increase in Intelligent Cloud revenue. UBS noted that despite the impressive results, the share price traded downwards after the release, mainly due to the 38% growth in Azure cloud services, which was expected to meet the 39% growth target.

UBS explained that Microsoft Corporation (NASDAQ:MSFT) made a strategic choice of prioritizing scarce GPU capacity for its own first-party products over Azure cloud services. The firm believes that this allocation difference can be one of the reasons the company slightly missed the estimates.

​Microsoft Corporation (NASDAQ:MSFT) provides AI-powered cloud, productivity, and business solutions, focusing on efficiency, security, and AI advancements.

Page 5 of 13