Microsoft (NASDAQ:MSFT) Earns Buy Rating from Jefferies Financial Group

Key Points

• Jefferies reiterated its Buy rating on Microsoft, adding to broad analyst optimism. Forty-three analysts rate the stock Buy, with a consensus “Moderate Buy” rating and average price target of $569.29.
• Microsoft reported strong quarterly results, including $4.74 in adjusted EPS versus a $4.24 estimate and $90.01 billion in revenue, up 17.7% year over year and above expectations.
• Shares opened at $493.50, while the company continues to benefit from Azure and Copilot growth and expanding AI infrastructure investment; however, elevated AI spending, customer concentration and Xbox restructuring remain risks.

Microsoft (NASDAQ:MSFT - Get Free Report)'s stock had its "buy" rating reiterated by research analysts at Jefferies Financial Group in a research report issued on Monday.

Other equities research analysts have also issued reports about the company. Citigroup restated a "market outperform" rating on shares of Microsoft in a report on Monday. Oppenheimer increased their price objective on shares of Microsoft from $515.00 to $570.00 and gave the company an "outperform" rating in a research note on Tuesday. Piper Sandler boosted their price target on Microsoft from $540.00 to $550.00 and gave the company an "overweight" rating in a research note on Tuesday, July 28th. Mizuho cut their target price on shares of Microsoft from $515.00 to $490.00 and set an "outperform" rating for the company in a research note on Wednesday, July 15th. Finally, Wells Fargo & Company increased their price objective on shares of Microsoft from $650.00 to $700.00 and gave the stock an "overweight" rating in a report on Wednesday, August 12th. Forty-three research analysts have rated the stock with a Buy rating, four have given a Hold rating and one has given a Sell rating to the company's stock. According to data from MarketBeat.com, Microsoft currently has a consensus rating of "Moderate Buy" and a consensus price target of $569.29.

Microsoft Stock Performance

Shares of MSFT stock opened at $493.50 on Monday. Microsoft has a 12-month low of $349.20 and a 12-month high of $553.72. The business has a 50 day simple moving average of $473.55 and a 200 day simple moving average of $424.91. The company has a debt-to-equity ratio of 0.07, a current ratio of 1.23 and a quick ratio of 1.22. The firm has a market capitalization of $3.66 trillion, a price-to-earnings ratio of 27.50, a price-to-earnings-growth ratio of 1.60 and a beta of 1.11.

Microsoft (NASDAQ:MSFT - Get Free Report) last announced its earnings results on Wednesday, July 29th. The software giant reported $4.74 earnings per share for the quarter, beating the consensus estimate of $4.24 by $0.50. Microsoft had a return on equity of 31.98% and a net margin of 40.31%.The business had revenue of $90.01 billion during the quarter, compared to analysts' expectations of $87.62 billion. During the same quarter last year, the business posted $3.65 earnings per share. The company's quarterly revenue was up 17.7% on a year-over-year basis. On average, equities research analysts anticipate that Microsoft will post 19.61 EPS for the current year.

Insider Buying and Selling

In other Microsoft news, EVP Amy Hood sold 41,674 shares of the business's stock in a transaction on Monday, September 14th. The shares were sold at an average price of $498.27, for a total transaction of $20,764,903.98. Following the sale, the executive vice president owned 533,624 shares of the company's stock, valued at approximately $265,888,830.48. The trade was a 7.24% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which can be accessed through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Satya Nadella sold 86,525 shares of the business's stock in a transaction that occurred on Tuesday, September 1st. The stock was sold at an average price of $501.46, for a total transaction of $43,388,826.50. Following the sale, the chief executive officer directly owned 486,763 shares in the company, valued at $244,092,173.98. The trade was a 15.09% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last 90 days, insiders sold 143,009 shares of company stock worth $71,420,699. 0.03% of the stock is owned by corporate insiders.

Institutional Investors Weigh In On Microsoft

Large investors have recently bought and sold shares of the stock. State Street Corp raised its position in Microsoft by 2.9% in the 2nd quarter. State Street Corp now owns 315,653,206 shares of the software giant's stock valued at $117,744,959,000 after buying an additional 8,944,917 shares during the last quarter. Auto Owners Insurance Co boosted its position in Microsoft by 56,160.8% during the fourth quarter. Auto Owners Insurance Co now owns 60,116,384 shares of the software giant's stock worth $29,073,486,000 after purchasing an additional 60,009,531 shares during the period. Bank of America Corp DE purchased a new position in Microsoft in the 2nd quarter valued at approximately $27,338,370,000. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC lifted its holdings in Microsoft by 0.9% during the 2nd quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 64,375,360 shares of the software giant's stock worth $24,013,297,000 after purchasing an additional 543,172 shares in the last quarter. Finally, Legal & General Group Plc bought a new position in shares of Microsoft in the second quarter valued at approximately $18,306,443,000. 71.13% of the stock is currently owned by institutional investors and hedge funds.

Trending Headlines about Microsoft

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Analyst confidence is improving. Stifel upgraded Microsoft to Buy from Hold and raised its price target to $575, citing Azure growth, Copilot adoption, stable margins and disciplined AI spending. Oppenheimer has also raised its target to $570, reinforcing expectations for additional upside. Microsoft Upgraded as Analyst Sees Steady Margins Even Without Heavy AI Model Spending
• Positive Sentiment: Azure remains the primary growth catalyst. Reports point to a major Azure milestone and two upcoming cloud catalysts that could lead investors to assign a higher valuation to Microsoft’s AI infrastructure and recurring cloud revenue. Strong Azure and Copilot momentum is also expected to support fiscal 2027 growth. Prediction: Microsoft’s Best Growth Opportunity May Still Be Ahead
• Positive Sentiment: Microsoft is expanding its AI infrastructure footprint. The company plans to invest more than $10 billion in Gulf countries through 2030, including cloud, AI infrastructure, cybersecurity and connectivity. The spending could create longer-term regional demand for Azure and related services. Microsoft Plans $10 Billion-Plus Gulf Investment
• Neutral Sentiment: Management is reshaping Microsoft around AI. Leadership is emphasizing an AI-first culture, safety evaluators and “emergency brake” controls for advanced systems. These initiatives may strengthen trust and enterprise adoption, though they also highlight regulatory and execution risks. Microsoft Recasts Culture Around AI
• Negative Sentiment: Risks include AI spending and concentration. Warnings about a potential AI bubble, hyperscaler capital requirements and dependence on a small number of customers could limit valuation expansion if AI demand slows.
• Negative Sentiment: Xbox restructuring remains a modest overhang. Microsoft is cutting hundreds of gaming jobs and transferring the next Halo project to Activision, signaling a broader reset in the gaming division. Microsoft Cuts Hundreds More Jobs in Xbox Overhaul

About Microsoft

Microsoft Corporation is a global technology company that develops software, cloud services, devices and digital solutions for consumers, businesses and public-sector organizations. Its products and services include the Windows operating system, Microsoft 365 productivity applications, Teams collaboration software, Dynamics business applications and Azure cloud computing services.

The company also operates LinkedIn, GitHub and Xbox, which includes gaming consoles, video games and related online services.

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