5 Stocks Most Bought by Hedge Funds in Q1 2026

2. Microsoft Corporation (NASDAQ:MSFT)

Number of Hedge Fund Holders: 282

Microsoft Corporation (NASDAQ:MSFT) ranks among stocks most bought by hedge funds in Q1 2026. On May 27, Morgan Stanley, in a note to clients, discussed whether Wall Street is fully valuing the scale of future AI revenues at Microsoft Corporation (NASDAQ:MSFT) and whether investors are underestimating how much monetization the company’s fast-growing AI infrastructure can support.

Analyst Keith Weiss pointed out that “GenAI demand well ahead of supply has yielded swiftly ramping Capex forecasts” for Microsoft Corporation (NASDAQ:MSFT).

However, Morgan Stanley noted that revenue expectations have not increased at the same pace. According to the bank, its “Monetization per Megawatt and Capex-Implied Azure forecasts suggest revenues estimates may be inappropriately lagging, leaving room for upward revisions.”

Weiss also said that Morgan Stanley’s analysis of hyperscaler spending and Microsoft Corporation’s (NASDAQ:MSFT) data center growth indicates significant upside. He wrote that the firm’s analysis “suggests Microsoft is deploying AI datacenter capacity well ahead of near-term monetization.” He added that the market may not have fully recognized the potential scale of the future revenue.

Microsoft Corporation (NASDAQ:MSFT) is an American technology company that specializes in AI-powered cloud, productivity, and business solutions. The company develops and markets software, services, and hardware.