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Image source: Getty Images <\/p>\n Image source: Getty Images <\/p>\n
Nvidia stock remains popular with UK investors and for good reason. Not only is the company generating unbelievable revenue growth but it also looks attractively valued.<\/p>\n
Yet looking at data from investment platform AJ Bell, another Magnificent 7 stock is seeing more interest from UK investors right now. This growth stock\u2019s well off its highs and investors are buying the dip.<\/p>\n
The stock I\u2019m talking about is Microsoft (NASDAQ: MSFT). It\u2019s a global leader in business productivity software, cloud computing and artificial intelligence (AI), and video gaming.<\/p>\n
Over the last month, it has been the fourth most bought stock on AJ Bell\u2019s platform. The only three stocks more popular have been BP, Legal & General and Rolls-Royce \u2013 more traditional picks for UK investors.<\/p>\n
Personally, I\u2019m not surprised Britons are attracted to this Magnificent 7 name. Because right now, it looks a lot like Alphabet (Google) stock 18 months ago.<\/p>\n
It went through a period where its share price was depressed due to the fact that investors thought its days as a tech powerhouse were numbered. However, since then, it\u2019s come roaring back \u2013 more than doubling in price \u2013 as shown it\u2019s still a major player in the tech world.<\/p>\n
As for why Microsoft shares are depressed today, there are a few reasons. One is that it\u2019s been dragged into the software sell-off (some investors believe that demand for its software products will decline).<\/p>\n
Another is that its AI products, such as Copilot, haven\u2019t been life-changing. A third reason is that a lot of its cloud business seems to be coming from ChatGPT owner OpenAI (which it owns a large chunk of) so there\u2019s some customer concentration risk.<\/p>\n
Finally, it\u2019s spending a lot of money on AI infrastructure. And there\u2019s no guarantee this spending will generate a strong return on invested capital.<\/p>\n
Now, these are all issues to think about from a risk management perspective. However, to my mind, the risk\/reward set-up is attractive at current levels.<\/p>\n
Despite being a very large company (it has a market-cap of approx. $3.2trn today), Microsoft is still growing at a very impressive rate. This financial year (ending 30 June), revenue\u2019s expected to grow about 16%.<\/p>\n
Driving this growth is the company\u2019s cloud computing division. This is growing at 20%-30% annually, fuelled by the growth of the AI industry.<\/p>\n
Looking beyond the growth, Microsoft\u2019s also extremely strong financially. This is a company with a rock solid balance sheet that pays regular dividends (the yield is quite low) and buys back its own shares. It also has a great record in terms of shareholder returns. Anyone who has owned this stock over the long run has done incredibly well.<\/p>\n
As for the valuation, it looks attractive relative to the level of growth. At present, the forward-looking price-to-earnings (P\/E) ratio is 22.<\/p>\n
Given these attractions, I believe the stock\u2019s worth considering for an ISA or SIPP. But it\u2019s not the only tech stock I like the look of right now.<\/p>\n
The post UK investors are piling into a Magnificent 7 stock and it isn\u2019t Nvidia<\/a> appeared first on The Motley Fool UK<\/a>.<\/p>\n More reading<\/p>\n Edward Sheldon has positions in Microsoft, Nvidia, and Alphabet. The Motley Fool UK has recommended Alphabet, Microsoft, Nvidia, and Rolls-Royce Plc. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.<\/a><\/p>\n Motley Fool UK 2026<\/p>\n","protected":false},"excerpt":{"rendered":"Image source: Getty Images Nvidia stock remains popular with UK investors and for good reason. Not only is…\n","protected":false},"author":2,"featured_media":22265,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[10111,10112,10110,10109,1968,5359,1854,5,6],"class_list":{"0":"post-22264","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-uk","8":"tag-bought-stock","9":"tag-cloud-computing","10":"tag-growth-stock","11":"tag-magnificent-7","12":"tag-microsoft","13":"tag-nvidia","14":"tag-revenue-growth","15":"tag-uk","16":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@UnitedKingdom\/116469985621936628","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/posts\/22264","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/comments?post=22264"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/posts\/22264\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/media\/22265"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/media?parent=22264"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/categories?post=22264"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/tags?post=22264"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}