BMO Capital Reiterates Buy Rating on Microsoft (MSFT) Stock

Microsoft Corporation (NASDAQ:MSFT) is one of the Best Monopoly Stocks to Buy Now. On October 30, analyst Keith Bachman from BMO Capital reiterated a “Buy” rating on the company’s stock and reduced the price objective to $625.00 from $650.00. The analyst stated that the growth of Microsoft Corporation (NASDAQ:MSFT)’s Azure platform was strong, thanks to the healthy bookings, mainly from deals with OpenAI, as well as the commitment, which is yet to be added to the backlog.

BMO Capital Reiterates Buy Rating on Microsoft (MSFT) Stock

In Q1 2026, the company stated that revenue in Intelligent Cloud came in at $30.9 billion and rose 28%, with Azure and other cloud services revenue increasing 40% (up 39% in constant currency).

Additionally, the analyst stated that Microsoft Corporation (NASDAQ:MSFT)’s impressive margin expansion, despite headwinds, reflects its operational efficiency. The potential for AI to help long-term growth and durable opportunities in the company’s portfolio supports its favourable outlook, added Bachman. Microsoft Cloud revenue amounted to $49.1 billion, rising 26% (up 25% in constant currency). The commercial remaining performance obligation rose 51% to $392 billion.

Wedgewood Partners, an investment management company, released its Q3 2025 investor letter. Here is what the fund said:

“Microsoft Corporation (NASDAQ:MSFT) has also spent quite heavily on capex over the past several years, having stood up more than 2 gigawatts of data center capacity over the past 12 months alone, yet it has also produced very attractive cash low returns. It exited its fiscal 2025 with almost $370 billion in gross property plant and equipment and capitalized leases, up a remarkable $260 billion from fiscal 2020. Meanwhile, gross cash low grew from $60 billion a year in 2020 to more than $140 billion per year in 2025. When we add in the rest of the assets on Microsoft’s balance sheet, we calculate its gross cash lows to be a consistent returns on capital in the high 20s. That is an extraordinary attractive return for such massive amounts of investing.”

While we acknowledge the potential of MSFT to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than MSFT and that has 100x upside potential, check out our report about this cheapest AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.