For years, Amazon (NASDAQ:AMZN) and Microsoft (NASDAQ:MSFT) have been the clear leaders in the cloud market globally. However, their Chinese rivals are pouring in millions of dollars to increase their market share in Southeast Asia, a Wall Street Journal report highlighted.
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According to the report, top Chinese companies, including Alibaba (NYSE:BABA), Tencent Holdings (TCEHY), and Huawei Technologies, are making aggressive investments to expand their cloud businesses in Southeast Asia. To attract more customers in emerging markets like Thailand and Indonesia, they are offering low-cost products in these countries.
The growing presence of Chinese tech companies in Southeast Asia and their ability to offer lower-priced products indicate that AMZN and MSFT will likely face heightened competition to grow their market share in that region.
Nevertheless, these American tech giants have deep pockets and will likely retain their dominance in the cloud space, at least in the foreseeable future. Further, these companies are also ramping up their investments in the cloud segment to support demand.
It remains a wait-and-watch story as to how competition evolves in Southeast Asia. Meanwhile, let’s check what Wall Street analysts recommend for AMZN and MSFT.
Is Amazon a Buy, Hold, or Sell?
Wall Street is bullish about Amazon stock. It has received 36 Buy and three Hold recommendations for a Strong Buy consensus rating. The consensus 12-month forecast of $137.05 indicates 37.68% upside potential.
Meanwhile, hedge funds bought 29M shares of AMZN last quarter. Further, it has an Outperform Smart Score of nine.
What Are Analysts Saying About MSFT?
Analysts are optimistic about MSFT’s prospects. It sports a Strong Buy consensus rating on TipRanks based on 25 Buy, three Hold, and one Sell recommendations. Moreover, analysts’ price target of $291.63 on MSFT stock implies 7.49% upside potential.
While analysts are bullish, hedge funds sold a whopping 141M shares of MSFT last quarter. Meanwhile, insiders sold $6.4M worth of MSFT stock. Overall, it has an Outperform Smart Score of nine.