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Billionaire investor Bill Ackman has turned his attention to one of tech’s biggest players, placing a confident wager on a company many investors have recently soured on, Microsoft.

In a post on X, Ackman announced that his hedge fund, Pershing Square, will soon disclose a new position in Microsoft in its 13F filing.

He revealed that his firm began building the position in February after the stock slid sharply following its fiscal second-quarter results. According to Ackman, Microsoft’s pullback offered a rare value opportunity for a company with dominant market share and unmatched infrastructure.

“We began building our position in MSFT in February following a meaningful share price decline after the company reported its fiscal Q2 2026 results,” Ackman said.

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“We were able to establish our position at a valuation of 21 times forward earnings, broadly in line with the market multiple and well below Microsoft's trading average over the last few years.”

As two of the largest forces in equity markets -- growing index ownership and increasing amounts of capital controlled by extremely short-term-oriented, leveraged, volatility-intolerant investors -- converge, we have found occasional opportunities to acquire some of the most…

— Bill Ackman (@BillAckman) May 15, 2026

That valuation, Ackman said, significantly understates Microsoft’s full potential, particularly given its powerful partnership with OpenAI.

He estimates Microsoft’s 27% stake in OpenAI could be worth around $200 billion, or roughly 7% of the company’s market capitalization—a number that investors have yet to properly factor into their calculations.

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Ackman’s move comes as Microsoft shares have underperformed the broader market this year. The stock has dropped 17%, while the S&P 500 has climbed around 10%. Sentiment cooled after disappointing earnings and concerns about ballooning capital expenditures in the race to dominate artificial intelligence.

Those skeptics, however, may be missing the bigger picture. Ackman believes fears over Microsoft’s competitiveness and spending trajectory are misplaced.

“We believe Microsoft's recent share price decline has been principally driven by investor concerns around two key issues: the competitive positioning of M365 against increasingly capable AI lab offerings… and the durability of Azure's growth,” he explained.

From Ackman’s vantage point, Microsoft’s productivity suite remains one of the most entrenched software ecosystems ever created. “Investors underestimate the resilience of the M365 franchise given its deeply embedded role across enterprises and highly attractive price-value proposition,” he added.

The integration of identity, security, and compliance features across Microsoft’s platform, he emphasized, would be “nearly impossible to replicate.”

The numbers back that up. While Microsoft’s aggressive capital spending program—an estimated $190 billion for 2026, far above Wall Street’s expectations—initially alarmed investors, it may ultimately strengthen the company’s AI ambitions. These investments support Azure’s infrastructure and the rapidly growing demand for large-scale computing power.

Market technicians are also taking notice. Evercore ISI’s Rich Ross recently highlighted that Microsoft has reclaimed its 50-day moving average “with authority.”

He noted that from a technical standpoint, the setup looks bullish again after the stock found strong support near levels that have historically signaled reversals.

“The stock can be owned both fundamentally and technically,” Ross wrote, implying that long-term investors see a rare convergence of value and momentum.

In other words, Microsoft might finally be hitting a point where the pessimism is fully priced in.

Wall Street analysts share some of that optimism. Wedbush’s Dan Ives called Microsoft one of his favorite large-cap tech names, pointing to an “AI driven shift about taking place in Redmond heading into the back half of the fiscal year.”

Ives argued that the market continues to underestimate Azure’s growth potential even as new AI workloads begin to flow through the platform.

Ackman’s endorsement carries weight precisely because of his track record investing in large technology names that others doubted.

His disciplined approach and focus on intrinsic value often lead him into positions that later deliver outsized returns. For Ackman, this is not a speculative AI gamble—it is a calculated play on a dominant balance sheet and durable cash flows that are temporarily mispriced.

The timing also makes strategic sense. With inflation edging higher and the Federal Reserve signaling that rates could stay elevated longer, many investors are rotating toward quality assets with deep moats and strong margins. Microsoft fits that bill far more comfortably than many of its high-flying peers.

For Microsoft shareholders battered by recent volatility, Ackman’s entrance is more than symbolic.

It signals that one of Wall Street’s most disciplined voices sees hidden value where the crowd sees risk. As AI competition continues to heat up, Ackman may prove that the biggest opportunities often lie where patience meets conviction.

DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.