Heart: MSFT Morningstar Rating: ★ ★ ★ ★ ★ Estimated price versus fair value: 35% discount Performance to date: -17% Rationale: Microsoft has a wide economic moat, and its business is protected by factors such as its cost advantage and the “network effect,” said Dave Sekera, U.S. market strategist at Morningstar, referring to the tech
Heart: MSFT
Morningstar Rating: ★ ★ ★ ★ ★
Estimated price versus fair value: 35% discount
Performance to date: -17%
Rationale: Microsoft has a wide economic moat, and its business is protected by factors such as its cost advantage and the “network effect,” said Dave Sekera, U.S. market strategist at Morningstar, referring to the tech giant’s large existing user base.
Despite a brutal selloff this year, the company is on track to achieve a compound annual revenue growth rate of 15%, Morningstar estimated.
“Overall, when I look at Microsoft, I think the company has many different ways to benefit from AI, and both are positive if AI is everything everyone claims it is,” Sekera said.