Microsoft Is Reportedly Getting Pickier About AI Data Center Deals. Is the Stock a Buy Now?

Microsoft is tightening oversight of AI data center deals with neocloud providers like Nebius Group and Nscale, reportedly backing away from riskier projects. While this could reduce financial risk, the company's free cash flow has declined 23% year-over-year to $60 billion, and shifting focus to building its own data centers may worsen cash flow pressures in the short term. The analyst maintains that Microsoft's stock at $535 remains overvalued and would prefer entry closer to $465.