Wall Street Says Microsoft Stock Has 89% Rebound Potential. Should You Buy the Dip Now?

The so-called “Magnificent Seven” stocks once dominated the market, driving most of the gains and becoming the go-to names for investors seeking high growth. But recently, the AI momentum has cooled off. Nonetheless, Microsoft (MSFT) continues to show strong underlying growth, suggesting that while the broader group may be slowing, this tech giant still has plenty of strength left. Even Jefferies and Piper Sandler analysts have chosen Microsoft as their top AI pick, citing the stock's reasonable valuation when compared to its long-term profitability potential.

While MSFT is down 26% year-to-date (YTD), compared to the tech-heavy Nasdaq Composite Index ($NASX) fall of 9%, its fundamentals suggest it could rebound by 89% from current levels.