Microsoft Corp (NASDAQ:MSFT) shares are rising on Friday. A major investment firm revealed it has built a new position in the company, arguing that the recent pullback created an attractive entry point. Here’s what you should know.
- Microsoft shares are advancing steadily. What’s pushing MSFT stock higher?
The firm said it will disclose the stake in its 13F filing later today and described Microsoft as one of the strongest long‑duration compounders in the market.
Ackman Builds Position After Valuation Pullback
Investor Bill Ackman, CEO of Pershing Square, laid out a detailed case on X explaining why it began accumulating shares in February, shortly after Microsoft sold off following its fiscal second-quarter 2026 results. According to the firm, the decline allowed it to buy Microsoft at roughly 21 times forward earnings, a valuation it considers compelling relative to the company's history.
The investor also noted that Microsoft's headline valuation does not fully reflect the value of its roughly 27% economic interest in OpenAI, which would equate to about $200 billion at the AI lab's most recent funding round.
Confidence Builds Around M365, Azure And Microsoft's AI Strategy
The firm argued that recent concerns around competition for M365 and questions about Azure's durability are overstated. It emphasized that M365 is deeply embedded across global enterprises, supported by decades of investment in identity, security, compliance and governance infrastructure. The suite also benefits from strong bundle economics, with customers paying far less than they would if they purchased individual tools from separate vendors.
The investor highlighted Microsoft's push to integrate Copilot across M365 and the shift toward a hybrid pricing model that combines seats with metered AI usage, which it believes will expand the company's revenue opportunity over time.
On the cloud side, the firm pointed to Azure's strong momentum, including 39% constant‑currency growth last quarter and guidance for further acceleration. It views Microsoft's decision to restructure its OpenAI partnership as a strategic move toward a more flexible, multi‑model approach that better aligns with enterprise needs. More than 10,000 enterprise customers have already used multiple models on Azure Foundry, reinforcing that strategy.
The investor also noted Microsoft's plan to lift its 2026 capex budget to roughly $190 billion, with most of that spending directed toward servers and networking equipment that directly support near‑term cloud revenue.
MSFT Shares Are Climbing
MSFT Price Action: Microsoft shares were up 3.51% at $423.80 at the time of publication on Friday, according to Benzinga Pro.
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