![\"Microsoft](\"https:\/\/barchart-news-media-prod.aws.barchart.com\/FC\/7551cae632760285a9769a0e5e4852d6\/%3Furl%3Dhttps%253a%252f%252fg.foolcdn.com%252feditorial%252fimages%252f883920%252fmicrosoft-logo-is-microsoft.jpg%26amp%3Bw%3D700\"\/){kind=logo}
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Image source: Microsoft.<\/p>\n
Why Microsoft investors might worry<\/p>\n
Hyperscalers as a whole are expected to grow their capital spending 57% this year, relative to 2025, says Morgan Stanley. Microsoft, in particular, plans to spend $190 billion as it builds out its AI infrastructure<\/a>.<\/p>\n This much was already known.<\/p>\n What’s new today is that Morgan Stanley is warning that “the gap between capital deployment and revenue generation continues to pressure near-term cash generation.” At least some hyperscalers simply aren’t generating enough free cash flow<\/a> to cover their enormous cash outlays. And as a result, MS forecasts that some companies will need to take out more loans to cover the gap — and pay higher interest rates<\/a> to do so.<\/p>\n What this means for Microsoft stock<\/p>\n The good news is that Morgan Stanley says higher-quality borrowers will probably pay less extreme interest rates than lower-quality borrowers (such as Oracle(NYSE: ORCL), which has a rated mid-to-low BBB credit rating, reports StreetInsider.com).<\/p>\n The better news is that Microsoft is arguably one of the best credit risks out there in hyperscaler land. Although Microsoft is carrying a pretty substantial debt load of $129 billion, it has $77 billion in the bank to cover its payments and is generating gobs of free cash flow — even after paying for capital investment: $67 billion is expected this year, according to data from S&P Global Market Intelligence<\/a>.<\/p>\n Long story short, despite MS’s misgivings, Microsoft stock will be just fine.<\/p>\n Should you buy stock in Microsoft right now?<\/p>\n Before you buy stock in Microsoft, consider this:<\/p>\n The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks<\/a> for investors to buy now\u2026 and Microsoft wasn\u2019t one of them. The 10 stocks that made the cut could produce monster returns in the coming years.<\/p>\n Consider when Netflix made this list on December 17, 2004… if you invested $1,000 at the time of our recommendation, you\u2019d have $421,511!* Or when Nvidia made this list on April 15, 2005… if you invested $1,000 at the time of our recommendation, you\u2019d have $1,381,960!*<\/p>\n Now, it\u2019s worth noting Stock Advisor\u2019s total average return is 981% \u2014 a market-crushing outperformance compared to 216% for the S&P 500. Don’t miss the latest top 10 list, available with Stock Advisor, and join an investing community built by individual investors for individual investors.<\/p>\n See the 10 stocks \u00bb<\/a><\/p>\n *Stock Advisor returns as of August 17, 2026. <\/p>\n Rich Smith<\/a> has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Microsoft and Oracle. The Motley Fool has a disclosure policy<\/a>.<\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":"Key Points Investment banker Morgan Stanley says hyperscaler free cash flow isn’t measuring up. Massive capex have many…\n","protected":false},"author":2,"featured_media":142842,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[420,7829,309,148,980,1151,1303,1020,1304,1305,320,7828,1309,936,1308,1306,1307,1310],"class_list":["post-142841","post","type-post","status-publish","format-standard","has-post-thumbnail","category-microsoft","tag-azure","tag-azure-ai","tag-business","tag-business-news","tag-economy","tag-finance","tag-financial-information","tag-investing","tag-investor","tag-market-news","tag-microsoft","tag-microsoft-ai","tag-motley-fool","tag-press-releases","tag-sedar","tag-stock-research","tag-stock-valuation","tag-the-globe-and-mail"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/posts\/142841","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/comments?post=142841"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/posts\/142841\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/media\/142842"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/media?parent=142841"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/categories?post=142841"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ai\/wp-json\/wp\/v2\/tags?post=142841"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}