We recently published a list of ChatGPT Stock Advice: Top 12 Stock Recommendations. In this article, we will take a look at where Microsoft Corporation (NASDAQ:MSFT) stands against other top stock recommendations by ChatGPT.
After a two-year surge of 53%, the stock market has been taken for a wild ride in 2025, driven by uncertainties surrounding the escalating trade wars. As of the close of business on May 2, the broad market index was down by 3.31% year-to-date.
READ ALSO: 11 Worst Performing Stocks in S&P 500 So Far in 2025 and 15 Stocks ChatGPT Predicts Could Make You Wealthy in 10 Years.
A New York-based investment banking firm recently projected positive but muted returns for 2025. However, it added that the continued adoption of AI could lead to a strong rally. The company also pointed out how bull markets have historically produced mediocre results in the third year, although not usually negative.
Trends over the past decades also show that sustained high returns are uncommon. Following the strong back-to-back performance in the 1920s, markets went down sharply in 1929, marking the beginning of the Great Depression. Then, after recovering in 1935 and 1936, they took a giant step back again a year later.
Over the years, many investors have turned toward ChatGPT for investment advice, including how the markets would respond to news headlines, statements from the Federal Reserve, or any other event that could cause share price movements. A 2023 survey revealed that about 53% of the Millennials, 50% of Gen Z, and 46% of Gen X respondents had used the AI chatbot for investing advice.
In contrast, older Americans were found to be more skeptical of the recommendations, with just 25% of the Baby Boomers using ChatGPT to buy stocks. Collectively, about 47% of all survey respondents had used the platform for stock recommendations. Among them, 69% stated they would consider using ChatGPT for investment advice in the future as well.
While the reliability of ChatGPT to provide accurate and up-to-date information has repeatedly come under question from most financial analysts, a professor at the University of Florida in 2023 claimed that the chatbot may be able to predict stock movements. Alejandro Lopez-Lira used the platform to parse negative and positive headlines for stocks and predict returns for the following day, and was surprised to find how good the results were.
Whether or not tools like ChatGPT are effective in stock recommendations remains a debate. However, they can be useful for new investors looking for financial education and researching companies they want to invest in.
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Our Methodology
For this list, we prompted ChatGPT to recommend the top 12 stocks based on its assessment of historical trends and the current market situation. The stocks are ranked in this article in the same order as provided by ChatGPT. The platform said it based its rankings on several factors, including long-term past performance, innovation capacity, economic resilience, and current macroeconomic trends.
For perspective, we have also shared the hedge fund sentiment toward each stock, based on Insider Monkey’s database of over 1,000 prominent hedge funds as of Q4 2024.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 317
Microsoft Corporation (NASDAQ:MSFT) is an American technology company, best known for its operating systems and software products.
On April 30, the company announced financial results for the third quarter of fiscal 2025. It reported a revenue of $70.1 billion, increasing 13% from last year (15% in constant currency). Operating income stood at $32 billion, representing a 16% year-over-year growth. Diluted earnings per share stood at $3.46, beating expectations of $3.22 per share.
The Intelligent Cloud segment has become a major driver of growth for Microsoft Corporation (NASDAQ:MSFT). Led by a strong show from Azure, the segment’s revenue increased 21% from the prior year to $26.8 billion, contributing over 38% of the company’s overall revenue.
Microsoft Corporation (NASDAQ:MSFT)’s Productivity and Business Processes segment also delivered a 10% increase in revenue to reach $29.9 billion, while More Personal Computing’s revenue was recorded at $13.4 billion, with an increase of 6%.
The results have calmed investors’ worries in what is an uncertain economic climate. This has led to an 11% surge in Microsoft Corporation (NASDAQ:MSFT)’s share price over the past week. The positive sentiment around the stock has also been bolstered by forecasts of revenue growth between 34% and 35% for Azure in Q4.
According to ChatGPT, Microsoft Corporation (NASDAQ:MSFT)’s strength in cloud computing, artificial intelligence, and productivity software, coupled with its robust financial performance, makes it a top pick.
Overall, MSFT ranks 1st among ChatGPT Stock Advice: Top 12 Stock Recommendations. While we acknowledge the potential of MSFT as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than MSFT but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires
Disclosure: None. This article is originally published at Insider Monkey.
