Ranking the Best "Magnificent Seven" Stocks to Buy for 2026. Here's My No. 4

Core Viewpoint - Microsoft is expected to deliver solid but unspectacular growth in 2026, ranking as the No. 4 stock in the "Magnificent Seven" for that year [1][4]. Company Overview - Microsoft is a computing powerhouse, offering a wide range of products including personal computers, operating systems, tablets, gaming consoles, and services like LinkedIn, Edge, and Bing [2]. - The company has made significant investments in artificial intelligence, particularly through its partnership with OpenAI, enhancing productivity and automation for users [2][6]. Financial Performance - Microsoft has experienced substantial growth over the last decade, with revenue increasing by over 230% and earnings per share and net income rising by more than 500% [8]. - For the first quarter of fiscal 2026, Microsoft reported revenue of $77.7 billion, an 18% increase year-over-year, with net income of $27.7 billion, up 12%, and earnings per share of $3.72, up 13% [10]. Segment Performance - The company operates in three primary segments: - Productivity and Business Processes: Revenue of $33.02 billion, up 16.6% year-over-year, with operating income of $20.41 billion, up 23.5% [11]. - Intelligent Cloud: Revenue of $30.89 billion, up 28.2%, with operating income of $13.39 billion, up 27.5% [11]. - More Personal Computing: Revenue of $13.75 billion, up 4.4%, with operating income of $4.16 billion, up 17.8% [11]. - The Intelligent Cloud segment is growing rapidly and is expected to surpass the productivity software tools as the most lucrative segment if the growth trajectory continues [11]. Investment Perspective - Microsoft is viewed as a solid and reliable investment option for 2026, with a stronger growth engine than Apple and a more effective business model than Amazon, while being less volatile than Tesla [12][13]. - The company is positioned in the middle of the pack among the "Magnificent Seven," with dynamic growth opportunities seen in competitors like Nvidia, Alphabet, and Meta Platforms [13].