After the recent selloff for Microsoft stock i compared it to the performance of Alphabet and Amazon going back to January 2024.
While Microsoft has returned 0% since January 2024, Alphabet has gained 158% and Amazon 58% in the same timeframe.
Microsoft has a current P/E ratio of 22, which has been the bottom within the last 10 years, peaking at 39 four times. The average has been around 30-35.
In conclusion i see Microsoft as very cheap considering the current stock price. Sure CapEx has been high, but the investments will show in Azure growth. OpenAI is obligated to run ChatGPT on Microsoft Cloud, as long as there is capacity available. Besides AI there is still a lot of room for Cloud usage in general, so i dont see a realistic risk of these investments turning into a problem. The business is growing, so the recent selloff seems unjustified.
Bought Leaps 2 weeks ago, bought again last friday and will do so again if the stock keeps falling / stagnating.
Whats going on here?