MSFT Stock Outlook: What’s in Store for Microsoft Investors in 2024?

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Microsoft (NASDAQ:MSFT) continues to dominate the tech sector, particularly in the realm of artificial intelligence. A leader in this field, Microsoft’s integration of ChatGPT across its services has been a major story, although its investments have not yet significantly impacted the top line for MSFT stock.

The company is expected to be the next company to reach a $3 trillion valuation, following Apple’s achievement in the summer. Analysts, including Wedbush’s Dan Ives, predict this milestone, attributing it to Microsoft’s ongoing AI monetization efforts.

Indeed, Microsoft is set up nicely for a positive 2024, and investors should not overlook this tech giant. Here are some other reasons to be bullish with the tech giant.

Copilot is Crushing the Web

Microsoft Windows Copilot, an AI-powered tool, has expanded its functionality by incorporating the ability to capture screenshots and generate questions. These enhancements make it an even more versatile tool, providing answers, project inspiration, and task solutions to users. Microsoft initially introduced the screenshot feature in Copilot for the Microsoft Edge browser in August last year, and it is now officially available on Windows Copilot.

Windows Copilot recently expanded its capabilities, introducing a new “add screenshot” option for users. This enhancement allows users to capture and inquire about specific screen areas through the chat box, available to all Edge users in a potential phased rollout by Microsoft.

Microsoft Windows Copilot has enhanced its capabilities with a new screenshot feature, allowing users to capture and share images directly. This integration helps users seek assistance, illustrate issues, and generate questions for content creation within the familiar Microsoft Office environment.

2024 is Microsoft’s Year

In 2024, corporate interest in generative AI is shifting from hype to action. Over half (55%) of top tech officers in various sectors intend to invest in enterprise-level gen AI software, like Microsoft Copilot, in the next six months. Another third (32%) are undecided, and only 13% won’t be acquiring such capabilities.

According to the CNBC Technology Executive Council Survey for H2 2023, over half (59%) of the 22 top tech officers surveyed, including CTOs, CIOs, and CISOs, reported that their companies’ investments in AI capabilities were accelerating. The remaining executives are proceeding more cautiously, with none stating they won’t invest in AI in 2024. Microsoft, a frontrunner in the generative AI market, stands to benefit from these spending trends, contributing to its notable stock gains, up 55% this year, surpassing the S&P 500 return.

Wedbush Securities analyst Dan Ives views Microsoft’s Copilot as a significant advantage, calling it the torchbearer for the broader AI market. Analysts project Microsoft’s stock to reach $600 in the next three years, with gen AI revenue potentially hitting $10 billion annually. 

Despite boardroom drama at OpenAI, which received substantial investment from Microsoft, the company’s shares surged from $240 to over $370 since the introduction of ChatGPT in November 2022. Jason Wong, a Gartner analyst, notes Copilot’s prominence, as 82% of IT buyers in a recent Gartner survey identified it among the top three valuable features in Microsoft 365.

MSFT Stock Looks Like a Buy Right Now

MSFT stock may not be the most thrilling stock, but its stability is evident, with a 64% gain in the past 52 weeks. Despite doubts about a repeat performance in 2024, a long-term investment in MSFT stock appears like a sensible move. 

Beyond generative AI investments, Microsoft’s stronghold in academia and the professional world, exemplified by Windows’ 72.79% market share in desktop operating systems, making this stock a reliable choice.

On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the Publishing Guidelines.

Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.

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