About 97% of Wall Street analysts consider Microsoft stock a buy, the highest percentage among S&P 500 stocks.
One of Microsoft’s key growth catalysts is its artificial intelligence cloud computing business, which is gaining market share.
Microsoft is also investing heavily in AI data centers, hoping to double its reach.
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among S&P 500 Index Few, if any, stocks are considered 100% Buy by the Wall Street analysts who cover them. In fact, you’d be hard-pressed to even find one.
fact set researchThe leading financial data provider has compiled a list of the S&P 500 stocks with the most Buy ratings through the end of 2025. At the time, only one stock was rated a Buy by 100% of analysts: Quality Electronics. But one analyst has since downgraded it to a Hold, so its Buy ratio is now 90%.
The rest are the tech giants Microsoft(NASDAQ:MSFT) Wall Street’s most beloved S&P 500 stock, 97% of analysts rate it a buy, with 3% recommending a hold and 0% recommending a sell.
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The median price target among the 64 analysts who cover Microsoft is $631 per share, suggesting they expect the stock to return about 37% over the next 12 months. The only other “Big Seven” stocks that come close are Amazon(NASDAQ: AMZN)95% consider it a Buy, and meta platform92% of analysts rate it a Buy.
Why analysts are so bullish on Microsoft stock — and should you be too? Let’s take a look.
For Microsoft, it is mainly its strength in artificial intelligence (AI) and cloud computing. It continues to gain market share (driven by its Azure platform) and close the gap with market leader Amazon Web Services. By the end of the third quarter of 2025, Amazon’s market share fell below 30% to around 29%, while Microsoft climbed to around 22%.
In the most recent quarter, revenue from the Azure platform for more complex artificial intelligence cloud computing grew 40%, contributing significantly to the company’s 28% growth in the intelligent cloud segment.
In its cloud business, remaining performance obligations (RPO) – contracts signed but not yet executed – increased 51% to $392 billion. This includes OpenAI’s $250 billion commitment to use its Azure cloud platform.
In its outlook for the second fiscal quarter ending December 31, Microsoft expects revenue to reach US$79.5 billion to US$80.6 billion, a year-on-year increase of 14% to 16%. The Azure and intelligent cloud business is expected to grow 37%.
Another potential long-term growth driver for Microsoft is a major push into artificial intelligence data centers. In its most recent quarter, Microsoft announced it would invest $34.9 billion in capital expenditures, about half of which would be used to develop and expand data centers. Microsoft Chairman and CEO Satya Nadella said during the first quarter 2026 earnings call:
We have the largest data center fleet in the AI era, and we are adding capacity at an unprecedented scale. This year, we will increase our total AI capacity by more than 80% and approximately double our total data center footprint over the next two years, reflecting the demand signals we are seeing.
Microsoft stock has been declining recently, largely due to broader concerns related to artificial intelligence capital spending. Many investors wonder whether the massive spending on artificial intelligence will translate into returns. That may be true for many AI stocks, but not for Microsoft and other cloud providers. Microsoft provides the necessary infrastructure for AI investments, so its capital expenditures are critical to its growth.
The fact that Microsoft shares are down about 9% over the past six months and 5% year-to-date (year-to-date) makes now an especially good time to invest in Microsoft given its growth forecasts. It trades at a reasonable 32 times earnings and a forward price-to-earnings ratio of just 28, right around the Nasdaq 100 average.
Ultimately, analysts are almost unanimous in saying Microsoft is a buy, and it’s hard to argue with that. If you already own it, this might be a good opportunity to double down on your investment.
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Dave Kovaleski has no position in any of the stocks mentioned. The Motley Fool has positions and recommendations at Amazon, FactSet Research Systems, Meta Platforms, and Microsoft. The Motley Fool recommends the following options: Long January 2026 Microsoft calls at $395 and short January 2026 Microsoft calls at $405. The Motley Fool has a disclosure policy.
97% of Wall Street analysts say this Big Seven stock is a buy: Double down in 2026? Originally posted by The Motley Fool
