Microsoft Is Down 25% From Its High While the Nasdaq Blasts Off. Burry and Ives Say That Is the Opportunity

"Despite the vicious upside rally, though, shares of Microsoft ( NASDAQ:MSFT | MSFT Price Prediction) have continued to struggle. The stock dipped just over 0.6% on Wednesday in what was a great day for tech, with the Nasdaq 100 gaining more than a percentage point. At this point, it seems like Microsoft is no longer worthy of a spot in the Mag Seven. The stock is still down over 25% from its high, and with certain SaaS stocks still under pressure as AI advances, questions linger as to whether the software side of the business should warrant Microsoft's relative discount."

"Unlike most other SaaS firms that are at risk of severe cannibalization, though, Microsoft looks incredibly well-positioned to shift gears into the agentic age. If it means fewer Office or Dynamics licenses will be sold at the hands of next-generation AI-native applications, at the very least, Azure stands to gain as agents spark an increased appetite for tokens. Other SaaS players don't have that same luxury."

"Also, given that Microsoft Windows is the operating system of choice for the enterprise, it feels like the entire ecosystem has a wide moat, even as some of the AI-native frontier plays look to reinvent the operating system with agentics front and center. In my view, Microsoft is more likely to succeed with the agentization of its operating system. Arguably, the company is already on the right track, with Agent 365 already on the fast track."

"With Agent 365 recently graduating from "preview," it will be interesting to see how the control plane can transform the workplace as it acts as a launch pad for the agentic revolution. Why Microsoft might be one of the last real table pounders Of course, the number-one reason to pound the table on Microsoft as it readies to go all-in on the AI rev"

Nasdaq 100 and S&P 500 are rising strongly as AI leads market gains and more Magnificent Seven stocks reach new highs. Microsoft shares, however, have continued to lag, falling slightly on a strong tech day and remaining more than 25% below their prior high. Concerns persist about whether Microsoft’s software business deserves its relative discount as some SaaS stocks face pressure from AI advances. Microsoft is viewed as better positioned than many SaaS firms because it can shift toward agentic applications, potentially reducing reliance on some Office or Dynamics licensing while increasing demand for Azure tokens. Its Windows enterprise footprint is described as creating a broad ecosystem moat, and Agent 365 moving from preview is expected to support workplace transformation via an agentic control plane.

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