Key Points
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SpaceX is set to be included in the Nasdaq-100 after the market closes on July 6, but there could be better Nasdaq-100 buys.
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Microsoft trades down roughly 29% from its lifetime high and looks like a great long-term investment.
- 10 stocks we like better than Microsoft ›
Space Exploration Technologies (NASDAQ: SPCX) is set to be incorporated into the Nasdaq-100 index after the market closes on July 6. The Nasdaq-100 consists of the 100 largest non-financial companies by measure of market capitalization, and inclusion in the index can have a meaningfully positive impact on a company’s stock price.
Because funds that track the Nasdaq-100 need to purchase shares of SpaceX to accurately reflect the index’s composition, there could be a significant near-term uptick in demand for the stock as a result of the index rebalancing. While its upcoming inclusion in the Nasdaq-100 could be a significant positive catalyst for SpaceX stock, I think there’s a company already included in the index that stands out as a much better buying opportunity right now.
This AI stock looks like a great long-term buy after pullbacks in 2026
While the trading backdrop for leading artificial intelligence (AI) chip stocks has been incredibly bullish this year, many top software plays have actually been under pressure. Despite posting strong business results and possessing great infrastructure and a wealth of established business relationships that have continued to expand, Microsoft (NASDAQ: MSFT) has been a poster child for lagging software stocks.
At the end of April, Microsoft published results for the third quarter of its 2026 fiscal year — which ended March 31. The business posted non-GAAP (adjusted) earnings per share of $4.27 on sales of $82.89 billion, significantly exceeding the average Wall Street estimate of $4.06 on revenue of $81.39 billion. Overall revenue was up 18% year over year, and revenue from the company’s Azure and other cloud services businesses rose 40%, beating the average analyst target for growth.
Despite the strong quarter, the company’s share price has moved 8% lower since publishing the business update. The stock is also down roughly 19% year to date and 28% from its lifetime high.
Trading at roughly 20 times this year’s expected earnings, Microsoft isn’t getting enough credit for its strengths in AI and the broader software market. While there is some risk that the company’s core enterprise software offerings could face disruption from new, AI-focused challengers, there’s little indication this is happening currently. What’s more, Microsoft is hardly resting on its laurels — and the technology giant has one of the strongest bases in the world when it comes to tech, capital resources, and human talent.
While smaller, more specialized software players may face some substantial threats related to the rise of artificial intelligence, it seems like a mistake to lump Microsoft into that basket. With the company still looking incredibly strong and its stock trading at depressed levels, I think that Microsoft shares stand out as a worthwhile portfolio addition for long-term investors right now.
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Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Microsoft. The Motley Fool has a disclosure policy.
