Key Points
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Microsoft is arguably a leader in artificial intelligence (AI), not a laggard as some observers might think.
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Salesforce has a massive customers base and is expanding its AI services with its popular enterprise software.
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Alphabet has already created a top AI model in Google Gemini, and its cloud sales are rising fast thanks to AI.
- 10 stocks we like better than Microsoft ›
The ongoing threat that artificial intelligence (AI) could disrupt software companies has left many investors wondering if previous tech leaders can succeed in the AI age. And that’s left some tech stocks looking like really good deals right now.
Morningstar analyst Dan Romanoff recently said, “Software firms are the most undervalued they have been in the last three years” and are facing high uncertainty. Some investors assume that software companies are done and that AI will replace everything they do. That’s just not true, especially when it comes to enterprise software.
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Three companies that look like good deals — and that will likely benefit because of AI — are Microsoft (NASDAQ: MSFT), Salesforce (NYSE: CRM), and Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG). Here’s why these stocks are worth buying now.
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Microsoft has been all-in on AI for years
If there’s one software stock investors really shouldn’t worry about in the AI age, it’s Microsoft. The company has adapted quickly to artificial intelligence and was one of the early investors in OpenAI.
Microsoft owns an estimated 27% of OpenAI, which may come in handy when the company goes public later this year, and was quick to implement ChatGPT models into its Copilot service early on. That move helped Microsoft stay at the forefront of the AI boom, and it proved to its many enterprise customers that keeping their Microsoft 365 subscriptions is still a must-have move in the AI age.
What’s more, Microsoft has adapted an approach to using new AI models for its services. The company recently began offering Claude as part of its Copilot service, and its commercial cloud users have access to it by default. This shows Microsoft’s ability to adapt and implement rising AI models as they emerge, instead of just betting on one horse.
And finally, Microsoft is also working on its own AI models, aiming to develop a “superintelligence” by introducing new models over the next five years.
The average price-to-earnings ratio for the tech sector is just over 43, making Microsoft’s trailing P/E ratio of 26.5 look like a steal right now.
Salesforce is on the right track
Tech investors have shunned Salesforce over the past year, pushing its shares down about 20%. But their pessimism is mostly based on fears that AI will disrupt the company, which doesn’t appear to the case.
Consider that the company’s sales rose 12% to $11.2 billion and earnings per share jumped 37% to $3.81 in the fourth quarter of 2026, both outpacing analysts’ consensus estimates.
Importantly, Salesforce continues to make progress with its AI strategy. Since launching AI services, the company said it has completed 2.4 billion AI agent work units — meaning instances in which customers used Agentforce to deliver real work. What’s more, the company’s Agentforce AI service exceeded $800 million in annual recurring revenue, up 169% from the year-ago quarter.
Salesforce has more than 150,000 customers, with most of the world’s largest companies relying on its customer relationship management software. That reach won’t easily be eroded, even by fancy new AI models. Salesforce software is built specifically for customer management, and its customers aren’t likely to part ways with Salesforce just because some new AI emerges; the switching costs are just too high when managing so much important customer data.
Salesforce’s stock has a trailing P/E ratio of just 24 right now, making this leading enterprise software company a significant bargain compared to the rest of the tech industry.
Alphabet’s AI has a real advantage already
The early worries that Alphabet and its Google services would be left in the dust by AI companies now look like an overreaction. The company’s Google Gemini is gaining real traction as a viable competitor to ChatGPT, and Claude and already has more than 750 million monthly active users.
And Gemini is about to get a big boost in users when Apple launches a new version of Siri later this year, with Gemini reportedly serving as the underlying AI model. Not only does this show just how competitive Gemini can be in this space — billions of devices could use the new Siri — but Alphabet will reportedly receive $1 billion annually from Apple.
More proof of Alphabet’s AI success comes from the company’s Google Cloud sales, which house the company’s AI revenue and rose 48% in the fourth quarter to $17.7 billion. With Alphabet investing up to $185 billion in capital expenditures this year, mostly for AI data center infrastructure, more advanced AI models and additional AI sales are likely on the way.
And with Alphabet’s shares having a trailing P/E ratio of just over 30 right now, the stock looks very attractive compared to the rest of the tech industry.
Should you buy stock in Microsoft right now?
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Chris Neiger has positions in Apple. The Motley Fool has positions in and recommends Alphabet, Apple, Microsoft, and Salesforce. The Motley Fool has a disclosure policy.
