MSFT, PLTR, or NVDA: Which AI Stock Is the Best Pick?

Ongoing trade wars, rising competition, and macro uncertainty have raised concerns about a slowdown in spending and demand in the artificial intelligence (AI) space. However, the recently reported results of many AI companies reflected resilience and continued strength in the AI market. Using TipRanks’ Stock Comparison Tool, we placed Microsoft (MSFT), Palantir Technologies (PLTR), and Nvidia (NVDA) against each other to find the best AI stock, according to Wall Street analysts.

Microsoft (NASDAQ:MSFT)

Tech giant Microsoft’s stock has risen 9% year-to-date. The company impressed investors with upbeat results for the third quarter of Fiscal 2025. Further, Microsoft’s Azure and other cloud services delivered a 33% growth in revenues, with AI contributing 16 points of that growth.

The company also issued strong guidance, which helped in addressing concerns about a slowdown in growth amid macro pressures. Moreover, Microsoft continues to invest in AI infrastructure to capture the growing demand. That said, MSFT’s capex is expected to grow at a slower rate in Fiscal 2026 compared to the current year.

Is Microsoft a Buy, Sell, or Hold?

Following the Microsoft Build 2025 event, Goldman Sachs analyst Kash Rangan increased his price target for MSFT stock to $550 from $480, while maintaining a Buy rating. The 5-star analyst said that he came out of the event with stronger conviction in Microsoft’s AI investments, reinforcing visibility into more than $300 billion in Microsoft Cloud revenue by FY29 and a more efficient capex profile. Rangan noted that Microsoft revealed AI advancements across its stack, expanding developer access, deepening platform integration, and committing to open agentic AI via the Model Context Protocol (MCP).

Rangan believes that Microsoft is well-positioned to gain from increased Azure AI compute consumption and broader adoption of its platforms and applications.

Overall, Microsoft scores a Strong Buy consensus rating based on 30 Buys and five Hold recommendations. The average MSFT stock price target of $514.07 implies about 12% upside potential.

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Palantir Technologies (NASDAQ:PLTR)

Data analytics company Palantir Technologies has impressed investors with strong growth rates across its Government and Commercial businesses. The company’s AIP (Artificial Intelligence Platform) offering has been seeing robust demand.

Palantir stock has rallied more than 76% so far in 2025, with its strong financials proving the company’s might. The company delivered solid Q1 results and raised its full-year revenue guidance. Though several analysts acknowledge Palantir’s solid execution and strong growth potential, they remain concerned about its steep valuation.

Is Palantir a Good Stock to Buy?

Following the Q1 print, UBS analyst Karl Keirstead increased the price target for Palantir Technologies stock to $110 from $105 and reaffirmed a Hold rating. The 5-star analyst highlighted that PLTR delivered its 7^th straight quarter of top-line growth acceleration and materially raised the full-year revenue growth guidance to 36% from 31%, which is impressive given the ongoing macro uncertainty.

Keirstead added that PLTR stock fell in reaction to the results due to “the skinnier-than-expected” Q1 2025 revenue beat of 2.5% and a modest miss in commercial revenue. While the analyst continues to be impressed by Palantir’s fundamental story, he contends that valuation remains a major hurdle.

Wall Street has a Hold consensus rating on Palantir Technologies stock based on three Buys, 11 Holds, and four Sell recommendations. The average PLTR stock price target of $100.13 implies about 24% downside risk.

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Nvidia (NASDAQ:NVDA)

Semiconductor giant Nvidia exceeded Wall Street’s expectations with its robust results for the first quarter of Fiscal 2026. The company delivered upbeat results despite a $4.5 billion charge related to the export restriction on its China-bound H20 chips. Notably, revenue from the company’s data center segment surged 73% year-over-year in Q1 FY26.

Despite macro pressures and concerns about the loss of business due to the trade war with China, Nvidia remains confident about the “incredibly strong” global demand for its AI infrastructure. The company’s advanced GPUs (graphics processing units) are required for building and training AI models. Further, Wall Street is bullish on the demand for the company’s Blackwell platform.

What Is the Prediction for NVDA Stock?

In reaction to the results, Benchmark analyst Cody Acree reiterated a Buy rating on Nvidia stock with a price target of $190. The 5-star analyst said that he agrees with the market’s initial reaction to the results that, once the China charge and associated revenue are excluded, the company delivered a solid beat and raise report. Acree noted that the continued strength across AI industry infrastructure investments and Nvidia’s highly successful new product ramp have been recently overshadowed by an uncertain tariff environment and macro pressures, along with increased China export restrictions.

Acree believes that the Q1 report answers most of the market’s concerns, as Nvidia appears to be growing despite the China troubles. The analyst expects Nvidia to offer a new Chinese-tailored design variant over the next couple of months, “even as it was noticeably coy about its limited options during the call.” Acree added that the Chinese market is too large and strategically important for Nvidia to be absent for long. He expects CEO Jensen Huang to do “whatever is necessary to re-engage and reclaim its lost opportunity.”

With 36 Buys, four Holds, and one Sell recommendation, Wall Street has a Strong Buy consensus rating on Nvidia stock. The average NVDA stock price target of $171.62 implies about 25.5% upside potential. NVDA stock has risen by more than 2% year-to-date.

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Conclusion

Wall Street is bullish on Microsoft and Nvidia stocks but sidelined on Palantir. Analysts see higher upside potential in NVDA stock than in the other two AI stocks. They expect Nvidia to continue to experience robust demand for its AI chips despite ongoing pressures. The company’s Q1 FY26 results further strengthened analysts’ bullish thesis on NVDA stock, thanks to the chip giant’s solid execution and continued innovation.