We recently published a list of The 10 best stocks to buy according to Navellier & Associates. In this article, we take a look at the position of Microsoft Corporation (NASDAQ:MSFT) compared to the other stocks approved by Navellier & Associates.

Founded in 1987 by growth analyst Louis Navellier, Navellier & Associates is an independent firm based in Reno, Nevada. Navellier & Associates specializes in identifying market inefficiencies to find the highest growth stocks using a disciplined quantitative and fundamental analysis framework. With over 30 years of experience, they offer customized portfolio strategies for individual investors to maximize returns while managing risk. Unlike competitors that mimic indices, Navellier strives to outperform them, resulting in low correlation with benchmarks and greater diversification.

Louis Navellier is the founder, chairman of the board, chief investment officer, and chief compliance officer of Navellier & Associates, Inc. With decades of experience applying academic techniques to real-world market scenarios, he advocates disciplined quantitative analysis to identify stocks that can outperform the market. His approach involves a rigorous three-step process: quantitative analysis, fundamental analysis, and optimization of selected securities for inclusion in the portfolio. This approach has been used by the firm, which uses a highly disciplined bottom-up stock selection process for most portfolios. First, market and stock statistics are reviewed to measure return (alpha) and risk (standard deviation), and stocks in the top percentiles are selected. Next, the highest-rated stocks are further screened for high profit margins, strong earnings growth, and reasonable price-to-earnings ratios based on future earnings. Finally, a proprietary optimization model maximizes portfolio alpha while minimizing standard deviation, creating well-diversified portfolios across different sectors and industries.

Since 1980, he has shared his insights in the MPT Review, a stock advisory newsletter. Since 1987, he has actively managed individual portfolios, mutual funds, and institutional portfolios. Known for his charismatic leadership, Louis Navellier has been featured extensively in the international media, including CNBC, Bloomberg, The Nightly Business Report, and Wall Street Week. His insights have also been highlighted in Barron’s, Forbes, Fortune, Investor’s Business Daily, Money, Smart Money, and The Wall Street Journal. He has been profiled in books such as Kenneth A. Stern’s Secrets of the Investment All-Stars and Alan R. Ackerman’s Investing Under Fire. Mr. Navellier earned his Bachelor’s degree in Business Administration in 1978 and his MBA in Finance in 1979 from California State University – Hayward.

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Navellier & Associates is a well-known consulting firm with 1,314 clients and manages $743,578,818 worth of assets, according to their March 2024 Form ADV. Their first quarter 2024 filing shows that they manage $811,568,534 worth of securities, with the top ten holdings representing 29.01% of the total.

Our methodology

This article covers Navellier & Associates’ top 10 stock picks for Q1 2024. We’ve included analyst ratings and key details about these companies, as well as the number of hedge funds investing in each of these companies. Why focus on hedge fund investing? Our research shows that copying the top picks of leading hedge funds can lead to above-average returns. Our quarterly newsletter’s strategy of selecting 14 small-cap and large-cap stocks each quarter has returned 275% since May 2014, outperforming the benchmark by 150 percentage points. (Further details can be found here).

A development team that works together to develop the next version of Windows.

Microsoft Corporation (NASDAQ:MSFT)

Value of Navellier & Associates’ investment: USD 14,393,224

Number of hedge fund owners: 293

Microsoft Corporation (NASDAQ:MSFT) ranks 9th in Navellier & Associates’ top 10 stock picks. Microsoft Corporation (NASDAQ:MSFT) develops and supports software, services, devices, and solutions. Microsoft Corporation (NASDAQ:MSFT) is primarily driven by its advancements in artificial intelligence (AI) and cloud services, which are expected to increase revenue and significantly strengthen the company’s market position. Microsoft Corporation (NASDAQ:MSFT)’s AI capabilities, particularly through Azure and its integration with OpenAI technologies, are expected to drive strong revenue growth. Analysts forecast that Azure’s annual revenue could reach $76 billion, driven by increasing AI workloads and strong partnerships with OpenAI and GitHub.

In addition, Microsoft Corporation’s (NASDAQ:MSFT) Copilot, which embeds AI into its software, is expected to be a major growth driver. Analysts expect that over 50% of Microsoft Corporation’s (NASDAQ:MSFT) users will be using Copilot for business within three years, potentially adding $20 billion to its revenue by fiscal 2025. Due to these factors, analysts like JP Morgan have raised their price targets. JP Morgan has set their price target at $455, reflecting strong confidence in Microsoft Corporation’s (NASDAQ:MSFT) future performance.

ClearBridge Sustainability Leaders Strategy stated the following about Microsoft Corporation (NASDAQ:MSFT) in its second quarter 2024 investor letter:

Overall MSFT 9th place on our list of the best stocks to buy according to Navellier & Associates. You can visit The 10 best stocks to buy according to Navellier & Associates to see the other Navellier & Associates-approved stocks that are on hedge funds’ radar. While we recognize MSFT’s potential as an investment, we believe AI stocks promise higher returns and do so in a shorter time frame. If you’re looking for an AI stock that’s more promising than MSFT but trades at less than 5x its earnings, read our report on the cheapest AI stock.

READ MORE: Analyst sees a new $25 billion “opportunity” for NVIDIA And Jim Cramer recommends these 10 stocks in June.

Disclosure: None. This article was originally published on Insider Monkey.