Magnificent Seven Investing Playbook: Microsoft as the Apex Carrier
“Now that summer’s coming to an end, that means it’s time to pull out your scarves, grab a pumpkin spice latte, and reassess your tech stocks. This series helps you decide what to do with your shares of the biggest names in tech — Apple, Alphabet, Amazon, Microsoft, Meta, Nvidia, and Tesla — known as the Magnificent Seven. Up next is Microsoft, a leader in artificial intelligence.”
Yahoo Finance.
Microsoft is bigger than you can think of, and recently, it has gained more momentum.
“This is the year for Microsoft where the aircraft carrier is at its apex, where acceleration starts happening based on changes from some time ago,”
Gil Luria, a D.A Davidson analyst, told Yahoo Finance.
No one can build an aircraft carrier within the span of a night. As per Luria, the shift for the tech giant which is now worth over $2.4 trillion since Satya Nadella took the position of CEO back in 2019.
“Microsoft was coming off 15 years of stagnant growth, when the business grew but the stock did not,”
Luria added.
“They’d missed the shift to mobile, and at the time they had been far behind on the shift to cloud. Then, Satya Nadella took over.”
Right then, Nadella decided to make Microsoft less insular.
“He made it into a company that was far better integrated into the soft software technology ecosystem,”
Luria described.
“The second change he made was to become far more developer friendly, using a more open source approach … and [making] the business approach more developer friendly.”
Sitting today, Microsoft is embedded in our lives in the most intricate ways possible.
“The next big disruptive wave is AI, and Nadella recognized that early, which is why they invested in Open AI more than two years ago,”
Luria said.
“Not only did they invest in OpenAI, they put the wheels in motion to adapt their business to AI.”
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