Phillip Securities analyst Helena Wang upgraded Microsoft (MSFT) from "Hold" to "Buy."
Wang maintained the price target at $540.
The upgrade follows a recent stock price decline after the fiscal second-quarter earnings report.
Wang believes the decline created an attractive entry point for investors.
Microsoft beat revenue and earnings per share estimates in the recent report.
However, the stock fell.
Investors cited concerns over the significant increase in AI-related capital expenditures.
They also noted a perceived moderation in the growth of the Azure cloud platform.
Wang points to the company's strong fundamentals for the upgrade.
She expects a 16% year-over-year revenue increase in the third quarter.
Azure revenue is projected to surge 37%.