A Democratic sweep in the US midterms triggered a sharp rethink of AI spending, putting Microsoft (MSFT) in focus as investors reassessed how slower data center approvals might affect its existing cloud footprint. The stock jumped 6.7% on the post election move and now trades around $555.80, with a year to date share price return of 17.52% and a 1 year total shareholder return of 12.73%; the 3 year and 5 year total shareholder returns of 57.70% and 74.21% point to building momentum as investors weigh fresh AI partnerships, heavy bond financed data center spending and new regulatory risks against the value of the company’s existing cloud infrastructure. Microsoft now trades near record highs after the post election spike. Based on the most followed narrative, Microsoft’s last close at $555.80 sits well above a fair value estimate of $419.91, framing the rally as pricing in a lot of AI optimism already; at around $380, the stock trades at roughly 22 to 23x trailing earnings and ~14x EV/EBITDA, well below its own seven year historical range. See why 289 investors see Microsoft as 32% overvalued. The stock changes hands at a P/E of 28.9x, below the US Software industry average of 31x, yet above a 23.8x peer average, while the fair ratio for Microsoft is estimated at 56