Absolute Gestao de Investimentos Ltda. Buys New Position in Microsoft Corporation $MSFT

Key Points

• Absolute Gestao de Investimentos Ltda. purchased 5,000 Microsoft shares worth approximately $1.87 million, making MSFT its 29th-largest holding. Institutional investors collectively own 71.13% of the stock.
• Microsoft reported quarterly revenue of $92.28 billion and EPS of $4.89, exceeding analyst expectations, while revenue increased 18.8% year over year. The company also raised its quarterly dividend to $0.98 per share, or $3.92 annually.
• Analysts remain broadly bullish, with a consensus “Moderate Buy” rating and an average price target of $609.54, but investors are watching the risks from roughly $170 billion in AI spending, rising infrastructure costs and potential pressure on cloud margins.

Absolute Gestao de Investimentos Ltda. purchased a new stake in Microsoft Corporation (NASDAQ:MSFT - Free Report) in the second quarter, according to its most recent filing with the Securities and Exchange Commission (SEC). The fund purchased 5,000 shares of the software giant's stock, valued at approximately $1,865,000. Microsoft makes up 0.2% of Absolute Gestao de Investimentos Ltda.'s holdings, making the stock its 29th largest position.

Several other institutional investors have also made changes to their positions in MSFT. Bank of America Corp DE bought a new position in Microsoft in the second quarter valued at approximately $27,338,370,000. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC increased its stake in shares of Microsoft by 0.9% in 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 valued at $24,013,297,000 after purchasing an additional 543,172 shares during the last quarter. Legal & General Group Plc bought a new position in shares of Microsoft in the 2nd quarter valued at $18,306,443,000. Amundi raised its holdings in shares of Microsoft by 30.8% during the 1st quarter. Amundi now owns 41,675,076 shares of the software giant's stock worth $15,426,862,000 after buying an additional 9,814,598 shares in the last quarter. Finally, Dimensional Fund Advisors LP raised its holdings in shares of Microsoft by 10.5% during the 1st quarter. Dimensional Fund Advisors LP now owns 29,323,744 shares of the software giant's stock worth $10,852,884,000 after buying an additional 2,784,809 shares in the last quarter. 71.13% of the stock is currently owned by institutional investors.

Microsoft Price Performance

Shares of MSFT opened at $521.91 on Monday. The company has a market capitalization of $3.88 trillion, a PE ratio of 27.24, a PEG ratio of 1.61 and a beta of 1.05. Microsoft Corporation has a 12 month low of $349.20 and a 12 month high of $551.15. The stock's 50-day moving average price is $512.91 and its two-hundred day moving average price is $438.43. The company has a current ratio of 1.22, a quick ratio of 1.21 and a debt-to-equity ratio of 0.07.

Microsoft (NASDAQ:MSFT - Get Free Report) last issued its quarterly earnings results on Wednesday, October 28th. The software giant reported $4.89 earnings per share for the quarter, beating the consensus estimate of $4.72 by $0.17. Microsoft had a return on equity of 31.28% and a net margin of 41.17%. The company had revenue of $92.28 billion during the quarter, compared to analysts' expectations of $90.62 billion. During the same quarter in the prior year, the firm posted $4.13 earnings per share. The business's quarterly revenue was up 18.8% on a year-over-year basis. On average, analysts anticipate that Microsoft Corporation will post 19.79 EPS for the current year.

Microsoft Increases Dividend

The company also recently declared a quarterly dividend, which will be paid on Thursday, December 10th. Shareholders of record on Thursday, November 19th will be issued a dividend of $0.98 per share. This represents a $3.92 annualized dividend and a yield of 0.8%. The ex-dividend date is Thursday, November 19th. This is a positive change from Microsoft's previous quarterly dividend of $0.91. Microsoft's dividend payout ratio (DPR) is 19.00%.

Insider Activity

In other news, EVP Amy Hood sold 41,674 shares of the business's stock in a transaction that occurred on Monday, September 14th. The shares were sold at an average price of $498.27, for a total value of $20,764,903.98. Following the transaction, the executive vice president owned 533,624 shares in the company, valued at approximately $265,888,830.48. The trade was a 7.24% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Satya Nadella sold 86,525 shares of the stock in a transaction 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 owned 486,763 shares of the company's stock, valued at approximately $244,092,173.98. This trade represents a 15.09% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold a total of 150,314 shares of company stock worth $75,404,992 in the last 90 days. 0.03% of the stock is owned by company insiders.

More Microsoft News

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Microsoft delivered a strong fiscal first quarter, with revenue of $92.28 billion and EPS of $4.89, both above expectations. Azure revenue surged 48%, while Microsoft Cloud revenue rose 30%, reinforcing the view that AI demand is translating into meaningful cloud growth. Microsoft Earnings Expose a Growing Divide in the Magnificent 7 AI Trade
• Positive Sentiment: Management issued second-quarter revenue guidance of $96.0 billion to $97.1 billion, above the $95.7 billion consensus estimate. Analysts responded with multiple price-target increases, including targets of $630 to $680, and Wolfe Research upgraded the stock to “strong buy.”
• Positive Sentiment: Microsoft’s strong cash generation and diversified enterprise business continue to distinguish it from rivals facing sharper cash-flow concerns. Analysts argue that Azure, Copilot, AI agents and Microsoft’s security products provide several ways to monetize AI. The expanded Estée Lauder partnership, which will extend Copilot to more than 14,000 employees, offers another example of enterprise adoption. Estée Lauder and Microsoft Strategic Partnership
• Neutral Sentiment: Microsoft’s voluntary exit offer for approximately 60,000 employees may improve productivity and redirect resources toward AI, but it also highlights a significant restructuring as the company shifts toward more automated, equipment-intensive operations. Microsoft’s 60,000-Person Buyout Offer
• Negative Sentiment: Investors remain concerned about Microsoft’s capital intensity. The company plans roughly $170 billion of AI-related capital spending, while also arranging a $25 billion bond sale—the first major U.S. debt offering since 2017—to fund its buildout. Rising borrowing costs increase scrutiny of future AI returns. Microsoft Plans to Raise $25 Billion in Debt
• Negative Sentiment: Quarterly capital spending was below analyst expectations because third-party AI-chip and data-center capacity was delayed, pushing some capacity into the first half of 2027. While management described this as a supply issue rather than weaker demand, the miss hurt AI infrastructure suppliers and revived concerns about the pace of expansion.
• Negative Sentiment: Microsoft’s cloud gross margin is reportedly narrowing as chip, power, data-center and labor costs rise. With the Nasdaq 100 down sharply during October amid fears of an AI spending bubble, investors are demanding proof that Microsoft’s large backlog will convert into profitable cash flow—not merely future revenue.

Analysts Set New Price Targets

Several research analysts have commented on the company. Wolfe Research raised Microsoft from a "hold" rating to a "strong-buy" rating in a research note on Thursday. Barclays raised their price target on shares of Microsoft from $600.00 to $610.00 and gave the company an "overweight" rating in a research note on Thursday. Yorkville Ives began coverage on shares of Microsoft in a research note on Monday, October 5th. They issued an "outperform" rating and a $615.00 price target on the stock. Guggenheim lifted their price target on shares of Microsoft from $586.00 to $595.00 and gave the company a "buy" rating in a report on Thursday. Finally, Bank of America upped their price objective on shares of Microsoft from $500.00 to $600.00 and gave the stock a "buy" rating in a research report on Tuesday, September 1st. One investment analyst has rated the stock with a Strong Buy rating, forty-five have issued a Buy rating and four have issued a Hold rating to the company's stock. Based on data from MarketBeat.com, the stock currently has a consensus rating of "Moderate Buy" and an average target price of $609.54.

Microsoft Profile

Microsoft Corporation NASDAQ: MSFT is a global technology company that develops software, cloud services, devices and digital platforms. Its products and services are used by consumers, businesses, governments and educational institutions worldwide.

The company's principal offerings include the Windows operating system; Microsoft 365 productivity applications such as Word, Excel, Teams and Outlook; Azure cloud computing and infrastructure services; Dynamics business applications; and enterprise security solutions.

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