This is going to very overly simplistic. No talk about risk, interest rates, and discounting which are all VERY essential.
I am against stock picking, so that viewpoint will color my description.
And I am not a financial advisor


A share of stock just represents ownership in a company. If you buy one share of Microsoft stock you literally own (albeit, a very tiny piece) Microsoft.
And as an owner you are entitled to a proportional amount of Microsoft's assets and profits.

That Microsoft stock only has value because they there is the assumption that they will payout some of their profits to the shareholders throughout the future. These profit payouts are called dividends.

Let's say OKP Corp is only going to be around for 3 years. And owners of OKP Corp stock will get a $3 payment (dividend) every year. What is the most you will be willing to pay for this today, i.e. what is the price today?
Well, it will be the sum of what you expect to receive from holding it: $3 + $3 + $3 = $9.

Now let's say expectations change and you expect OKP to be more profitable. And as a result, you think they will pay larger dividends ($4 per year).
So now the price will be $4 + $4 + $4 = $12.

If you bought the stock before expectations changed you would have a $3 profit on your investment.


Similarly the price of Microsoft's stock is just the sum of each of those expected dividend payments they will make in the future.
If you think the price is too low today, that means you think that people's expectations about Microsoft's future profits are too low (i.e. they are underestimating Microsoft's growth).


A problem with this thinking is that the price represents the market's expectations.
There are millions of investors out there (many of which are highly informed) buying and selling this stock to the point where the price you see in the newspaper represents the average of everyone's expectations for Microsoft's future performance.

By taking a stance and saying this is definitely a stock to buy, you are basically saying that I know something that no one else knows.
But all these analysts, researchers, and other investors have all the same info you have (and much, much more).
So instead what you are saying is that they are not interpreting the information properly.

At the end of the day, the price of Microsoft at any given time represents everybody's expectations about future dividends, given the current available information.
New information to come is just as likely to be good as it is bad.
And as a result, the price is just as likely to go up as it is to go down

*Stock picking is a coin flip*