Microsoft vs. Salesforce: One Software Stock Remains a Top Pick, the Other Has Something to Prove, Says RBC
Microsoft (NASDAQ:MSFT) and Salesforce (NYSE:CRM) sell to many of the same corporate customers, and both are betting that AI agents, software that can carry out tasks on its own, will become a major source of revenue.
Today, Microsoft got an uncomfortable reminder of how much those customers rely on it. A global outage that started Thursday afternoon knocked Outlook and parts of Teams, Copilot and other Microsoft 365 services offline for millions of users, and it dragged into Friday after the first fixes didn’t hold. Microsoft says it has found no sign of malicious activity.
Microsoft shares are down around 1.5% in premarket trading on Friday. Salesforce has had a tough year of its own, with the stock down about 18% year to date.
RBC analyst Rishi Jaluria covers both tech giants and published notes on each this week, ahead of Microsoft’s Ignite conference (November 17-20) and Salesforce’s fiscal third-quarter report on December 2.
Microsoft
Starting with Microsoft, the analyst expects Ignite to show how far the company has pushed AI into every layer of its business, from data centers and in-house chips to apps and security. However, he doesn’t see the event moving the stock much in the short term.
The backdrop is strong. Azure grew 48% in constant currency last quarter, up from 43% the quarter before, and management has guided for 49% to 50% this quarter. Jaluria believes demand still outruns the capacity Microsoft can bring online, which makes that guidance look cautious, though the year-ago comparison is a tough one. He wants updates on capacity and on Maia 300, the custom chip unveiled in October, which Microsoft is designing to be 40% more efficient than leading GPU setups and expects to roll out at multi-gigawatt scale in 2027.
Then there’s Copilot. Daily users jumped about 50% from the prior quarter and more than fivefold year over year, while customers with over 50,000 Microsoft 365 seats grew more than 8x. Jaluria thinks investors are overlooking Microsoft’s shift toward usage-based pricing, which Cowork and GitHub Copilot already use. Charging for consumption rather than per user could lift the ceiling on what Microsoft earns as agents take on more work, and he expects Ignite to add new agent-building and management tools.
“Stepping back,” Jaluria summed up, “MSFT continues to be our top pick, and we believe they are a differentiated AI beneficiary across the full stack. We see Ignite as an opportunity for management to further demonstrate the depth and breadth of AI monetization across the stack.”
To this end, Jaluria rates MSFT as Outperform (i.e., Buy) with a $640 price target, a figure pointing to 12-month returns of 22%. (To watch Jaluria’s track record, click here)
Microsoft gets a Strong Buy consensus rating on the Street, based on 35 Buys and 4 Holds. At $632.48, the average price target implies shares will gain 21% over the coming months. (See MSFT stock forecast)
Salesforce
Salesforce gets a cooler reception. Jaluria thinks software sentiment has yet to recover, and he lists Salesforce among the application companies without clear sight of a near-term growth pickup. That’s not because the numbers are weak. Fiscal second-quarter (July quarter) revenue rose 11% YoY, cRPO grew 14% in constant currency, and net new annual order value (AOV) posted its best growth in four years. Agentforce ARR climbed to $1.5 billion, up more than 240%.
What he can’t yet see is whether that momentum turns into lasting organic acceleration. Dreamforce left him slightly more upbeat. Its centerpiece, AI Force, opens Salesforce data, workflows and governance to outside AI tools through MCPs, APIs and plugins, on the argument that Salesforce’s real value lies in the business context underneath, not the screens people click on. Jaluria isn’t sure that holds up if AI model providers move into that territory, and easier outside access could eventually make Salesforce’s own apps less essential. Partner checks also suggest pricing is still being worked out.
M&A is the other sticking point. Braze (about $5.66 billion), Cresta, Listen Labs and Rune Technologies push Salesforce’s M&A spending over the past 12 months to roughly $27 billion by RBC’s estimate. Each deal makes strategic sense, Jaluria says, but together they pile on integration risk just as investors want homegrown growth. He has worried about a return to “empire-building” since the Informatica deal.
The stock trades at about 12x RBC’s calendar 2027 free cash flow estimate. “Valuation remains undemanding,” says Jaluria, “but the sustained M&A cadence, early-stage AI monetization, and the need to cleanly integrate multiple concurrent acquisitions make it difficult to underwrite material upside in the near-term. In our view, Salesforce needs to demonstrate that this acquisition wave translates into durable organic reacceleration before the stock can re-rate.”
To this end, he rates Salesforce as Sector Perform (i.e., Neutral) with a $250 price target. Still, should the figure be met, investors will be pocketing returns of 15% a year from now.
Eight other analysts join Jaluria on the sidelines, but with an additional 30 Buys, the stock claims a Strong Buy consensus view. Over the next year, shares are expected to appreciate by 29%, given the average price target stands at $280.41. (See CRM stock forecast)
Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
After a volatile post-election market, the S&P 500 (^GSPC -0.40%) now sits about 4% below its all-time high, but the Nasdaq-100Â is down by roughly 11%. Anybody waiting to buy the dip certainly has an opportunity right now. But whether they take it is something else altogether. Down markets tend to bring out some of the
There were no rockets decking Wall Street bank lobbies this past week, unlike the spectacle surrounding SpaceX’s blockbuster June listing. Instead, bankers marketing Anthropic’s (ANTH.PVT) potentially record-breaking initial public offering this week faced an unusually turbulent backdrop as Treasury yields surged and a widespread Microsoft Outlook outage hampered communications, all during — the biggest disruption
For the first time in 33 years, Nvidia is being run by someone other than Jensen Huang, and some of the loudest voices in the market are already lining up behind the person filling his seat. Jim Cramer, Ross Gerber, Daniel Newman, and Kevin O’Leary have all voiced support for interim CEO Colette Kress as
The stock market hasn’t been as keen on the hyperscalers in 2026 as it was in years past. Amazon (NASDAQ:AMZN) and Microsoft (NASDAQ:MSFT) have delivered better returns than the S&P 500 (SNPINDEX:^GSPC) year to date thanks to strong relative performances over the past month or so. Alphabet (NASDAQ:GOOG) (NASDAQ:GOOGL) and Meta Platforms (NASDAQ:META) haven’t fared
There’s been no shortage of market volatility over the last week. After experiencing their worst week of 2026 in early November, the S&P 500 (SNPINDEX:^GSPC), Nasdaq Composite (NASDAQINDEX:^IXIC), and Dow Jones Industrial Average (DJINDICES:^DJI) are rallying once again. However, that doesn’t mean that investors are in the clear. The tech industry is still struggling with
The Indian equity markets spent the week consolidating their recent gains and ended on a positive note. Following a remarkable rally of over 1,900 points in the preceding week, the Nifty did not witness any meaningful retracement and instead moved within a relatively defined range. The Index oscillated in a 585-point range, and despite some
Wall Street just had its best week since August, and chip stocks led the way. But by Friday the rally was cracking, and the bond market had turned against the AI trade. The PHLX Semiconductor Index (^SOX) still finished the week up about 8%, with the Nasdaq 100 (^NDX) up about 3.5% and the S&P
What you think about Micron Technology (MU -2.52%) could depend on how you view the proverbial glass of water, either half-full or half-empty. The half-full side would point to Micron’s impressive year-to-date gain of more than 150%. The half-empty folks would quickly add that the memory chip stock has plunged 40% since late June. Some
Representational image (Photo: ANI) The board of Dhampur Bio Organics Limited has approved a buyback of equity shares worth up to Rs 50 crore through the open market route, at a maximum price of Rs 200 per share, according to a stock exchange filing. The proposal still needs shareholder approval. The company said the buyback
All eyes were on Nvidia (NASDAQ:NVDA) this past week as the company’s leadership crisis quickly spiraled from a board investigation to the resignation of Jensen Huang as CEO. Investor attention is likely to remain on the AI chip leader this coming week, and it’s not just because there are so many questions now that Huang
Jim Cramer started his Charitable Trust in 2005 with $3 million of his own money. According to CNBC, Cramer’s own investment is at risk, and the trust distributes its investment income and realized capital gains to charity. The CNBC Investing Club gives subscribers a way to follow that portfolio. Members can see how much of
Advanced Micro Devices (AMD -8.75%) stock is sinking, down 10.8% as of 1:20 a.m. ET on Friday, Nov. 13, as the chip sector sells off amid the developing scandal at rival Nvidia (NVDA -2.01%). The S&P 500 (^GSPC -0.40%) and the Nasdaq Composite (^IXIC -0.91%) were down 0.8% and 1.3%, respectively. AMD – Advanced Micro
Nvidia (NVDA -2.01%) shares currently face a litany of headwinds. The first challenge has been a correction across AI stocks. Not every AI stock has been targeted. But many industry suppliers have seen their share prices slashed by 10%, 20%, or even 30% in recent weeks. Both Alphabet (GOOG -0.96%)(GOOGL -0.98%) and Meta Platforms (META
Wall Street’s AI trade just had one of its worst weeks in years. Politics and inflation hit it at the same time. The Nasdaq Composite posted its deepest one-day drop since April 2025 last week, after Democrats swept the midterm elections and investors began weighing tougher scrutiny of AI and limits on data center construction.
The Magnificent Seven stocks have not been so magnificent as of late. The Roundhill Magnificent Seven ETF (MAGS -0.29%), which invests exclusively in those seven mega-caps dubbed magnificent, has underperformed the S&P 500 this year. The exchange-traded fund, which invests in just seven stocks — Nvidia (NVDA -2.01%), Apple (AAPL +0.39%), Microsoft (MSFT +0.17%), Amazon
The recent sell-off in technology stocks has made some top names in this sector extremely attractive right now. For example, industry bellwethers Nvidia and Micron Technology are trading at extremely cheap multiples. Nvidia stock has a forward price-to-earnings (P/E) ratio of just 11, well below its five-year average forward earnings multiple of 33. It could
Bill Ackman and Jim Cramer are two of the most closely followed names on Wall Street. Cramer’s stock picks already get plenty of coverage, and we just looked at five stocks he is bullish on. See the five picks here. Ackman founded Pershing Square Capital Management in 2004. From 2004 through early 2026, the firm
Virgin Galactic (NYSE:SPCE) stock imploded Friday, tumbling 23.4% through 11 a.m. ET despite beating on top and bottom lines in its Q3 earnings report last night. Heading into the report, analysts forecast Virgin Galactic would lose $0.47 per share on sales of just $231,670 for the quarter. Virgin beat on both top and bottom lines,
Shares of Micron (MU -2.52%), the memory chip giant, were pulling back today as part of a broader sell-off in the chip sector. Investors continue to digest the shocking news that Jensen Huang has stepped down as the CEO of Nvidia (NVDA -2.01%) after a string of affairs that included a suspected Chinese spy and
Market Closed – 11:55:00 2026-11-13 am EST 5-day change 1st Jan Change 206.65 EUR -0.77% +5.22% +4.16% Published on 11/13/2026 at 03:54 pm EST EQS EQS-Ad-hoc: Airbus SE / Key word(s): Share BuybackAirbus reports share buyback transactions 9-13 November 2026 13-Nov-2026 / 21:52 CET/CESTDisclosure of an inside information acc. to Article 17 MAR of the
