Microsoft Reinstated at Buy by BofA on AI and Cloud Growth Potential

BofA Securities reinstated coverage of Microsoft (NASDAQ: MSFT) with a Buy rating and a $500 price target, citing strong long-term growth prospects driven by cloud computing and artificial intelligence.

The firm said the price target implies approximately 31% upside potential, supported by durable multi-year growth across Microsoft’s business segments.

BofA highlighted Microsoft’s strategic positioning in AI, noting that the company is uniquely placed to benefit across both infrastructure and applications. Its Azure cloud platform provides the computing and data backbone for enterprise AI workloads, while software products such as Microsoft 365, Dynamics, GitHub, and Windows are deeply integrated into everyday workflows, driving adoption and consumption.

The firm applied a valuation multiple of 24x estimated 2027 earnings, reflecting confidence in Microsoft’s resilient growth profile and its ability to monetize AI capabilities over the long term.