Microsoft Corporation (NASDAQ:MSFT) has seen a "Cinderella ending" to the OpenAI saga after OpenAI agreed to hire back Sam Altman as its CEO with a new initial board of directors consisting of Bret Taylor (chair), former US Treasury Secretary Larry Summers, and Adam D' Angelo, according to Wedbush analysts.
In an update to clients, the analysts stated they believe OpenAI will be virtually the same as before the "soap opera" began; however, it will have a much stronger governance now in place, which is key.
"Microsoft from the beginning wanted to keep this ongoing structure but ultimately had to pull the grandmaster chess move when the OpenAI board pulled out their kids checker set Friday night and began this Twilight Zone nightmare," the analysts wrote.
Analysts at Wedbush added that they believe OpenAI will be stronger from an innovation and governance perspective and the Microsoft relationship will be even firmer as the company and its CEO Satya Nadella were "the bedrock in backing Altman and OpenAI during this almost week-long saga."
They reiterated their ‘Outperform’ rating and $425 price target on Microsoft stock.
Shares of Microsoft gained more than 1% in pre-market trading on Wednesday.
Contact Sean at sean@proactiveinvestors.com