Alphabet Has Won, Amazon Will Win, Microsoft Pays The Price (For Now)
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Luca Socci5.89K FollowersFollow5ShareSavePlay(18min)Comment(1)SummaryMicrosoft Corporation’s AI growth is real, but MSFT stock is stalling as investors reprice returns, not demand. Rising capex, margin pressure, and delayed free cash flow are driving multiple compression.AI infrastructure requires massive upfront investment: MSFT may spend $75–85B per year in capex, pushing free cash flow lower near term and forcing the market into a “show-me-the-money” stance.With OpenAI economics evolving and Gemini intensifying suite-level competition, Microsoft remains a great business—but at current multiples, MSFT stock is fairly valued and awaits proof of AI-driven returns. lcva2/iStock Editorial via Getty Images What's wrong with Microsoft? Alphabet/Google (GOOGL) has won. Amazon (AMZN) is going to win. What about Microsoft Corporation (MSFT)? If you have come across the research I shared in recent weeks, I talked about howThis article was written byLuca Socci5.89K FollowersFollowI’m a long-term investor focused on U.S. and European equities, with a dual emphasis on undervalued growth stocks and high-quality dividend growers. Through years of experience, I’ve learned that sustained profitability—evident in strong margins, stable and expanding free cash flow, and high returns on invested capital—is a more reliable driver of returns than valuation alone. I manage one of my portfolios publicly on eToro, where I qualified as a Popular Investor, allowing others to copy my real-time investment decisions. My background spans Economics, Classical Philology, Philosophy and Theology. This interdisciplinary foundation sharpens both my quantitative analysis and my ability to interpret market narratives through a broader, long-term lens. I started investing when I became a father. By managing wisely what I received and earn, I aim to ensure for me and my children that we don't have so much that we don't have to do anything, but that we have enough assets to be free to do what we want. The goal is not to free myself from work, but to make sure I can work in the place and in a way where I can fully express myself.Analyst’s Disclosure:I/we have a beneficial long position in the shares of MSFT, GOOG, AMZN either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.