Generative AI Software Sales Could Soar 2,790%: 2 AI Stocks to Buy Now That Come Highly Rated by Wall Street
Summary
Microsoft is largest commercial software company in the world due to strength in business productivity (Office), enterprise resource planning (Dynamics), and several cybersecurity verticals. However, a recent CIO survey from Morgan Stanley showed Microsoft as the vendor most likely to gain share over the next three years, due in large part to strength in AI arising from its partnership with OpenAI. That makes the current valuation of 35 times earnings look a bit expensive, but Microsoft deserves a premium given its strong competitive position in the enterprise software and cloud services markets. The company is leaning into that opportunity with LLM Observability, a performance monitoring solution for the large language models (LLMs) that power generative AI applications. Indeed, Alex Zukin at Wolfe Research opined last year that Datadog could become "the fastest growing software company" as the generative AI boom unfolds.