In a recent report, Morgan Stanley highlighted Alphabet as one of the tech stocks with significant upside potential. The firm lauded the internet search giant for being “firing on all cylinders,” with an earnings report that was described as notably strong. Analyst Brian Nowak emphasized the durability of core growth and management’s success in reengineering the cost base. The firm raised Alphabet’s price target to $195 per share, reflecting a 17% potential increase. With YouTube growth accelerating and advancements in artificial intelligence, there is optimism for further growth in the stock.
Microsoft was praised by Morgan Stanley for its leadership position in AI. Following the company’s quarterly results, analyst Keith Weiss stated that the best is yet to come for Microsoft, with the company winning in AI. Despite a 33% increase in shares over the last 12 months, there is belief that there is still room for growth, particularly in EPS. The firm sees Microsoft as well-positioned to take advantage of the increasing AI market share as AI spending rises, indicating a promising future for the tech giant.
Morgan Stanley expressed enthusiasm for Spotify after the music streaming company reported strong earnings in late April. Analyst Benjamin Swinburne highlighted Spotify’s superior product and untapped pricing power, which are expected to drive underappreciated earnings power. Additionally, Swinburne pointed out an advertising opportunity that has not received enough attention from investors. With shares up 57%, the firm raised its price target on Spotify to $370 per share, indicating a positive outlook for the company’s growth potential.
Apple received positive feedback from Morgan Stanley for its above-Street guidance for the June quarter, alleviating concerns about China iPhone sales. The tech giant also achieved an all-time high in Services revenue and gross margin. With the largest incremental buyback authorization in history, Apple hinted at upcoming Gen AI announcements, contributing to a bullish sentiment among investors. The firm sees the potential for buybacks to increase to $23-25 billion per quarter, further solidifying its positive outlook on Apple’s future performance.
Overall, Morgan Stanley’s assessment of tech stocks points towards an optimistic view of the sector’s growth potential. With companies like Alphabet, Microsoft, Spotify, and Apple demonstrating strength in different areas such as AI, streaming services, and product innovation, there is room for further upside in the tech industry. Investors may find opportunities for growth and value in these carefully selected tech stocks based on Morgan Stanley’s analysis and recommendations.