Dan Ives Believes MSFT Is The Most Oversold Large-Cap Stock, Draws Parallels To 'Negative' Narratives Around GOOGL A Year Ago

• Ives said that there are no cracks in the AI armor despite the recent selloff in tech, AI, and chip stocks, citing the firm’s channel checks in Taiwan and South Korea.
• He added that demand for AI infrastructure currently outstrips supply by a ratio of 15 to 1.
• Ives added that even if margin pressures begin to show up, he doesn’t see them reflected in companies’ earnings over the next 9 to 12 months.

Wedbush’s Global Head of Tech Research, Dan Ives, on Wednesday said that Microsoft Corp. (MSFT) is the most oversold large-cap stock.

During an interview with Bloomberg, Ives highlighted Microsoft’s potential despite some missteps with Copilot, its AI companion.

"Have they made stumbles on Copilot and some other areas? Yeah. But in terms of enterprise, their backyard... Azure growth, compute supply issues... I think that that's ultimately a stock that, you know, $550, so I actually think that continues,” he said.

Microsoft shares were down about 1% in Wednesday’s pre-market trade.

Ives Draws Parallels To Narrative Around GOOGL

Ives drew parallels between the existing narrative around Microsoft to the conversations around Alphabet Inc.’s (GOOG, GOOGL) Google a year ago.

“Just like a year ago, the narrative on Google was so negative,” he said.

Alphabet’s Class A shares fell about 18% in the first quarter (Q1) last year. The company revamped its AI strategy in April 2025, tasking veteran Josh Woodward with leading Gemini amid concerns about AI eating into its search business. Since then, GOOGL stock is up about 138%.

No Cracks In The AI Armor, Says Ives Despite Selloff

Ives said that there are no cracks in the AI armor despite the recent selloff in tech, AI and chip stocks, citing the firm’s channel checks in Taiwan and South Korea.

He added that currently, demand for AI infrastructure is outstripping supply by a ratio of 15 to 1.

“My view is, even if you had some events to take some demand off, you don’t have an equilibrium probably for another year and half or two years,” he added, while saying that chip trade is what investors should continue to own.

Ives added that even if margin pressures begin to show up, he doesn’t see them reflecting in companies’ earnings for the next nine to 12 months.

“In my view, it just continues to be like… we’re still so early, relative to the [AI] buildout. You’re going to have these gut check moments, you’ll have these white knuckle periods, but we continue to view these as opportunities where you own the AI winners,” he added.

MSFT stock is down 23% year-to-date, while GOOGL stock is up 11%. The S&P 500 ETF (SPY) is up 22% over the past 12 months, while the Invesco QQQ Trust (QQQ) is up 34%.

Also See: Masayoshi Son Says ARM’s Valuation Could Soar Over 10X From $391B, Defends INTC Investment — ‘US Has No Choice But To Strengthen Intel’

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