There have been a couple of bumps on the road for Microsoft (NASDAQ:MSFT) this year, and it has seen its share price drip downward at various points in 2026. Though revenues are high and profits are healthy, the market hasn’t been fully convinced. MSFT’s share price has lost about 13% year-to-date.
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Other companies appear to have done a better job of capturing the AI-powered zeitgeist, while Microsoft hasn’t quite been able to emerge from the shadow of the megabucks it is devoting to capex spending (guiding for some $190 billion in the current year).
Still, that doesn’t mean everyone is down on Microsoft. According to a recent SEC filing, Bill Ackman’s Pershing Square took a new 5.65 million-share stake in Microsoft during the last quarter.
And he’s not the only one who spots an opportunity. Top investor Stefon Walters also sees merit in the world’s largest enterprise software company.
“It remains one of the best tech stocks you could own going forward,” states the 5-star investor, who is among the top 3% of stock pros covered by TipRanks.
Walters points out that the reach of Microsoft’s enterprise software gives the company a very large competitive moat. With 1.6 billion monthly active users of Windows devices, it is “ingrained in the daily operations of millions of businesses globally.”
That makes switching costs – i.e. moving from Windows to Mac – a tough sell for many, as it would entail a massive IT makeover and retraining employees, in addition to the equipment costs. Even a move to Alphabet’s Google Workspace isn’t so simple, he adds, as it requires migrating data and introducing other technical issues along the way.
Moreover, the company is “consistently” creating shareholder value, according to Walters. While it’s not one of the bigger dividend players, the investor notes that the company has been increasing its annual dividend for years.
And then there’s Microsoft’s business model, which is based on recurring revenue subscriptions. That creates reliable cash flow that more hardware-focused companies don’t necessarily enjoy, he states.
All that adds up to a bullish take on Microsoft for Walters, now and into the future.
“No tech stock has sustained success as long as this powerhouse,” emphasizes Walters. (To watch Walters’ track record, click here)
Wall Street heartily agrees. With 33 Buys and 2 Holds, MSFT enjoys a Strong Buy consensus rating. Its 12-month average price target of $559.98 points to an upside of 33%. (See MSFT stock forecast)
Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.