Analyst Recommendations for Microsoft and Amazon
CMB International Capital Corp. has recently started covering Microsoft and Amazon and assigned a Buy rating to both of them. The analysis reveals an optimistic outlook for the future of these tech giants.
Microsoft’s Strong Position in AI Technology
According to CMB analysts, Microsoft remains the consensus AI thematic pick among global tech stocks. They point out the cohesive product portfolio, exclusive partnership with OpenAI, and extensive consumer and business customer bases as key factors contributing to Microsoft’s strength in the market.
The analysts believe that Microsoft is well-positioned for further market share gains for all its key product portfolios with the empowerment of generative AI. They project an annual revenue growth rate of 21% for Microsoft’s Intelligent Cloud (IC) segment from fiscal year 2023 to 2026.
Amazon’s Growing Potential
As for Amazon, CMB analysts see ample potential for the company’s e-commerce business in both the US and international markets. They highlight the robust technological infrastructure of Amazon’s AWS cloud unit and the additional growth prospects presented by generative AI. The continuous increase in retail business efficiency and improvement in economies of scale are expected to boost profitability.
Predicted Revenue Growth
CMB projects that Azure’s revenue will grow at a compound annual growth rate (CAGR) of 30%, driven by increased user engagement and a significant rise in revenue generation from AI Cloud services. With the ramp-up of revenue generation from gen-AI and copilot, they are forecasting a FY23-26E total revenue CAGR of 15.8% for Microsoft, aiming for a total revenue of US$329.3bn by FY26. For Amazon, CMB’s target price sits at $213 per share.
In conclusion, CMB’s comprehensive analysis provides valuable insights into the future growth potential of these tech giants as they continue to innovate and evolve in the dynamic tech industry.
