Emerald Investment Advisers LLC Acquires New Shares in Microsoft Corporation $MSFT

Key Points

• Emerald Investment Advisers acquired 114,206 Microsoft shares valued at approximately $42.6 million, making Microsoft its fourth-largest holding and representing 2.8% of its portfolio. Institutional investors collectively own 71.13% of Microsoft.
• Microsoft reported quarterly EPS of $4.74, beating estimates by $0.50, while revenue reached $90.01 billion, up 17.7% year over year. The company also raised its quarterly dividend to $0.98 per share from $0.91.
• Analyst sentiment remains broadly positive, with 42 Buy ratings and an average price target of $589.71, although several firms recently downgraded the stock to Hold or Negative. Shares opened at $539.44, near their 52-week high of $553.72.

Emerald Investment Advisers LLC bought a new position in Microsoft Corporation (NASDAQ:MSFT - Free Report) in the second quarter, according to the company in its most recent filing with the Securities and Exchange Commission. The institutional investor bought 114,206 shares of the software giant's stock, valued at approximately $42,601,000. Microsoft makes up about 2.8% of Emerald Investment Advisers LLC's holdings, making the stock its 4th biggest holding.

Other institutional investors also recently modified their holdings of the company. Auto Owners Insurance Co grew its stake in Microsoft by 56,160.8% in the fourth quarter. Auto Owners Insurance Co now owns 60,116,384 shares of the software giant's stock valued at $29,073,486,000 after purchasing an additional 60,009,531 shares in the last quarter. Amundi increased its position in Microsoft by 30.8% in the 1st quarter. Amundi now owns 41,675,076 shares of the software giant's stock worth $15,426,862,000 after purchasing an additional 9,814,598 shares during the last quarter. Dimensional Fund Advisors LP raised its stake 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 purchasing an additional 2,784,809 shares in the last quarter. Hsbc Holdings PLC raised its stake in shares of Microsoft by 7.8% during the 4th quarter. Hsbc Holdings PLC now owns 22,138,798 shares of the software giant's stock worth $10,715,379,000 after purchasing an additional 1,599,412 shares in the last quarter. Finally, Arrowstreet Capital Limited Partnership lifted its holdings in shares of Microsoft by 64.3% during the 1st quarter. Arrowstreet Capital Limited Partnership now owns 24,264,779 shares of the software giant's stock valued at $8,982,083,000 after buying an additional 9,493,778 shares during the last quarter. Institutional investors and hedge funds own 71.13% of the company's stock.

Microsoft Stock Up 1.1%

Microsoft stock opened at $539.44 on Friday. The firm has a market cap of $4.01 trillion, a price-to-earnings ratio of 30.04, a P/E/G ratio of 1.71 and a beta of 1.10. The company has a debt-to-equity ratio of 0.07, a current ratio of 1.23 and a quick ratio of 1.22. Microsoft Corporation has a fifty-two week low of $349.20 and a fifty-two week high of $553.72. The firm has a fifty day moving average price of $504.95 and a two-hundred day moving average price of $439.96.

Microsoft (NASDAQ:MSFT - Get Free Report) last issued its quarterly earnings results on Wednesday, July 29th. The software giant reported $4.74 earnings per share (EPS) for the quarter, beating the consensus estimate of $4.24 by $0.50. The company had revenue of $90.01 billion for the quarter, compared to the consensus estimate of $87.62 billion. Microsoft had a return on equity of 31.98% and a net margin of 40.31%. The firm's revenue was up 17.7% compared to the same quarter last year. During the same period last year, the business posted $3.65 earnings per share. As a group, analysts forecast that Microsoft Corporation will post 19.65 earnings per share for the current year.

Microsoft Increases Dividend

The firm also recently announced a quarterly dividend, which will be paid on Thursday, December 10th. Shareholders of record on Thursday, November 19th will be issued a $0.98 dividend. This is an increase from Microsoft's previous quarterly dividend of $0.91. The ex-dividend date of this dividend is Thursday, November 19th. This represents a $3.92 dividend on an annualized basis and a yield of 0.7%. Microsoft's payout ratio is 20.27%.

Analyst Ratings Changes

Several equities research analysts recently commented on the company. BNP Paribas Exane cut Microsoft from a "strong-buy" rating to a "hold" rating in a research note on Monday, October 5th. BMO Capital Markets began coverage on Microsoft in a report on Monday, October 5th. They issued an "outperform" rating on the stock. Citizens Jmp reaffirmed a "market outperform" rating and set a $550.00 price objective on shares of Microsoft in a research report on Tuesday, September 15th. Morgan Stanley cut shares of Microsoft from an "overweight" rating to a "negative" rating in a research note on Monday, October 5th. Finally, Phillip Securities cut shares of Microsoft from a "moderate buy" rating to a "hold" rating in a research note on Monday. Forty-two equities research analysts have rated the stock with a Buy rating, four have issued a Hold rating and two have assigned a Sell rating to the company. According to data from MarketBeat, the company currently has an average rating of "Moderate Buy" and an average price target of $589.71.

Microsoft News Summary

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: UBS raised its price target to $675 from $525 and reiterated a Buy rating, citing accelerating Azure and Microsoft 365 growth driven by artificial intelligence. The firm believes Microsoft’s valuation remains reasonable despite its recent rally. UBS raises Microsoft price target
• Positive Sentiment: Multiple Wall Street firms have lifted their targets, with analysts highlighting Azure momentum, approximately 30 million Copilot seats, Microsoft’s commercial backlog and the potential for a larger-than-usual earnings beat. The October 28 results will provide an important test of whether AI spending is translating into revenue and profit.
• Positive Sentiment: Microsoft’s Maia 300 custom AI accelerator is expected to scale across Azure data centers and reportedly deliver more tokens per megawatt than conventional GPU systems. The chip could reduce inference costs and Microsoft’s dependence on Nvidia and AMD hardware. Microsoft Maia 300 AI chip
• Positive Sentiment: AI care-management company Tucuvi joined Microsoft’s Pegasus startup program, potentially expanding Microsoft’s enterprise AI pipeline and go-to-market reach in healthcare. Microsoft also increased its quarterly dividend to $0.98 from $0.91, signaling continued confidence in cash generation. Tucuvi joins Microsoft Pegasus Program
• Neutral Sentiment: Reports that Azure management is seeking roughly 20% cost reductions could improve efficiency and margins, but also underscore the pressure created by Microsoft’s substantial AI data-center investments.
• Neutral Sentiment: Microsoft’s $10 million contribution to a White House ballroom project is unlikely to affect near-term financial results, though it could attract political or reputational scrutiny. Microsoft White House ballroom contribution
• Negative Sentiment: Higher inflation and bond yields have pressured AI valuations and raised concerns about the financing cost and returns of large infrastructure projects. Microsoft’s strong balance sheet makes it less vulnerable than smaller AI companies, but valuation sensitivity remains a risk.
• Negative Sentiment: Phillip Securities downgraded Microsoft to Hold, while reports of security vulnerabilities, executive share sales and intense competition from rapidly growing AI companies add caution. Amy Hood’s sale was made under a pre-arranged Rule 10b5-1 plan, limiting its significance.

Insiders Place Their Bets

In other news, CEO Judson Althoff sold 10,000 shares of the stock in a transaction that occurred on Wednesday, August 5th. The stock was sold at an average price of $487.89, for a total value of $4,878,900.00. Following the completion of the sale, the chief executive officer directly owned 100,447 shares of the company's stock, valued at approximately $49,007,086.83. This represents a 9.05% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, EVP Takeshi Numoto sold 4,810 shares of the firm's stock in a transaction on Tuesday, August 4th. The stock was sold at an average price of $496.48, for a total transaction of $2,388,068.80. Following the completion of the sale, the executive vice president owned 42,677 shares in the company, valued at approximately $21,188,276.96. The trade was a 10.13% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Over the last quarter, insiders sold 150,314 shares of company stock worth $75,404,992. Corporate insiders own 0.03% of the company's stock.

Microsoft Company Profile

Microsoft Corporation is a global technology company that develops software, cloud services, devices, gaming products and business solutions. Founded in 1975 by Bill Gates and Paul Allen, the company is best known for the Windows operating system and Microsoft Office productivity software. Microsoft is headquartered in Redmond, Washington, and serves consumers, businesses, governments and educational institutions worldwide.

Microsoft's productivity and business offerings include Microsoft 365 applications such as Word, Excel, PowerPoint and Outlook, along with collaboration tools including Teams.

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