Hedge fund veteran Dan Ives believes one Mag 7 tech stock is undervalued and will soon print massive gains.
In a new CNBC interview, Ives says that Microsoft (MSFT) could surge by more than 30% from its current value as he expects artificial intelligence (AI) to start generating revenue for the company after large-scale investments in the technology.
“[Microsoft’s] defending their turf. They’re going after developers, and that’s really front and center in this arms race that we’re seeing play out, and I think these are the important steps, not just on Copilot and build, but what ultimately will be Azure, and that’s why I think right now the market is mispricing Microsoft to what I believe is still going to be the monetization phase that’s going to happen in the next six to 12 months.”
Ives believes Microsoft will hit $575, a more than 34% increase from its $427 price per share at time of writing.
Ives also says that AI technology still remains in its early stages and will be transformative for civilization in the coming years.
“It’s my view we’re still in the third inning of AI revolution relative to where this nine inning game is going. We could definitely have ebbs and flows in this market, but when you look where Alphabet’s positioned, they’re front and center, they’re top of the mountain right now. Amazon clearly has narrowed the gap. Microsoft obviously is doing a lot of great things in terms of Azure…
We’re talking about years, we’re talking about fourth industrial revolution in terms of what they’re going after.”
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