Bill Ackman said Friday on the social media platform X that his Pershing Square hedge fund has sold Alphabet (GOOG, GOOGL) shares and established a new position in Microsoft (MSFT).
Pershing began buying Microsoft in February after a notable share price decline following its fiscal Q2 results, acquiring a position at a valuation of 21 times forward earnings, in line with the market multiple and well below Microsoft's trading average over the last few years, Ackman said.
Ackman said investors underestimate the resilience of the Microsoft 365 franchise given its embedded role across enterprises and highly attractive price-to-value proposition, according to the X post.
Concerns regarding the growth trajectory of Microsoft's Azure cloud business are similarly misplaced, especially after the franchise's exceptional recent performance, he added.
"We believe that $MSFT offers analogous and compelling long-term value at today's valuation," Ackman said on X.
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