Fifth Third Bancorp Lowers Holdings in Microsoft Corporation $MSFT

Key Points

• Fifth Third Bancorp reduced its Microsoft stake by 2.3% in the second quarter, selling 104,684 shares and retaining 4.47 million shares valued at approximately $1.67 billion.
• Institutional ownership remains substantial at 71.13%, while analysts are broadly bullish: 43 rate Microsoft a Buy, with a consensus “Moderate Buy” rating and an average price target of $571.18.
• Microsoft reported stronger-than-expected quarterly results, with revenue rising 17.7% year over year to $90.01 billion and EPS of $4.74; it also raised its quarterly dividend to $0.98 per share.

Fifth Third Bancorp lowered its position in Microsoft Corporation (NASDAQ:MSFT - Free Report) by 2.3% in the second quarter, according to its most recent 13F filing with the Securities and Exchange Commission. The firm owned 4,471,738 shares of the software giant's stock after selling 104,684 shares during the quarter. Microsoft accounts for about 2.7% of Fifth Third Bancorp's holdings, making the stock its 7th largest position. Fifth Third Bancorp owned 0.06% of Microsoft worth $1,668,048,000 at the end of the most recent reporting period.

A number of other institutional investors and hedge funds have also modified their holdings of the company. Auto Owners Insurance Co lifted its holdings in shares of Microsoft by 56,160.8% during the 4th quarter. Auto Owners Insurance Co now owns 60,116,384 shares of the software giant's stock worth $29,073,486,000 after acquiring an additional 60,009,531 shares during the period. Amundi increased its stake in Microsoft by 30.8% in the first quarter. Amundi now owns 41,675,076 shares of the software giant's stock valued at $15,426,862,000 after acquiring an additional 9,814,598 shares during the period. Fisher Asset Management LLC raised its position in Microsoft by 1.8% in the fourth quarter. Fisher Asset Management LLC now owns 25,300,410 shares of the software giant's stock worth $12,235,785,000 after purchasing an additional 458,014 shares in the last quarter. Dimensional Fund Advisors LP lifted its stake in Microsoft by 10.5% during the first 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 during the period. Finally, Hsbc Holdings PLC boosted its holdings in Microsoft by 7.8% during the fourth quarter. Hsbc Holdings PLC now owns 22,138,798 shares of the software giant's stock valued at $10,715,379,000 after purchasing an additional 1,599,412 shares in the last quarter. 71.13% of the stock is currently owned by institutional investors.

Wall Street Analyst Weigh In

A number of brokerages have recently issued reports on MSFT. Royal Bank Of Canada reissued an "outperform" rating on shares of Microsoft in a report on Thursday, September 10th. DA Davidson reiterated a "buy" rating and issued a $550.00 price target on shares of Microsoft in a research report on Thursday, July 30th. Morgan Stanley reiterated an "overweight" rating on shares of Microsoft in a research note on Thursday, July 30th. Deutsche Bank Aktiengesellschaft restated a "buy" rating on shares of Microsoft in a research note on Monday, July 20th. Finally, Scotiabank reiterated an "outperform" rating and issued a $510.00 target price on shares of Microsoft in a research note on Thursday, July 30th. Forty-three research analysts have rated the stock with a Buy rating, four have issued a Hold rating and one has issued a Sell rating to the company's stock. According to MarketBeat, the stock presently has an average rating of "Moderate Buy" and a consensus price target of $571.18.

Microsoft Stock Up 0.9%

Shares of NASDAQ MSFT opened at $517.53 on Friday. Microsoft Corporation has a 52-week low of $349.20 and a 52-week high of $553.72. The company has a debt-to-equity ratio of 0.07, a quick ratio of 1.22 and a current ratio of 1.23. The stock has a market cap of $3.84 trillion, a P/E ratio of 28.82, a P/E/G ratio of 1.65 and a beta of 1.10. The firm has a 50 day moving average price of $490.08 and a 200 day moving average price of $429.97.

Microsoft (NASDAQ:MSFT - Get Free Report) last posted its earnings results on Wednesday, July 29th. The software giant reported $4.74 earnings per share for the quarter, topping the consensus estimate of $4.24 by $0.50. Microsoft had a net margin of 40.31% and a return on equity of 31.98%. The company had revenue of $90.01 billion for the quarter, compared to analyst estimates of $87.62 billion. During the same period last year, the business posted $3.65 earnings per share. The business's revenue for the quarter was up 17.7% compared to the same quarter last year. Analysts expect that Microsoft Corporation will post 19.62 EPS 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 dividend of $0.98 per share. This is a boost from Microsoft's previous quarterly dividend of $0.91. This represents a $3.92 annualized dividend and a yield of 0.8%. The ex-dividend date is Thursday, November 19th. Microsoft's dividend payout ratio is presently 20.27%.

Insiders Place Their Bets

In other Microsoft news, CEO Satya Nadella sold 86,525 shares of the stock in a transaction dated Tuesday, September 1st. The stock was sold at an average price of $501.46, for a total value of $43,388,826.50. Following the completion of the sale, the chief executive officer directly owned 486,763 shares in the company, valued at $244,092,173.98. This represents a 15.09% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, EVP Amy Hood sold 41,674 shares of the firm's stock in a transaction dated Monday, September 14th. The stock was sold at an average price of $498.27, for a total value of $20,764,903.98. Following the sale, the executive vice president directly owned 533,624 shares in the company, valued at approximately $265,888,830.48. This represents a 7.24% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders sold a total of 143,009 shares of company stock valued at $71,420,699 in the last three months. Insiders own 0.03% of the company's stock.

Key Stories Impacting Microsoft

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Azure and AI demand remain the primary catalyst. Investor data and analyst commentary point to accelerating Azure demand, while Microsoft’s recent earnings showed its fastest cloud growth in four years. The improving demand is helping ease concerns that the company’s substantial AI infrastructure spending will not generate adequate returns. Ca$htag: MSFT Azure Cloud Drives Soaring Demand
• Positive Sentiment: Wells Fargo added Microsoft to its Q4 Tactical Ideas list and raised its price target to $725, citing Azure’s growth potential and the prospect of improved AI monetization through Copilot. The action adds to a series of bullish analyst revisions; one report noted that 52 analysts covering Microsoft currently have no sell ratings. With Azure as a Catalyst, Microsoft Is Positioned for Sustained Growth
• Positive Sentiment: Microsoft’s OpenAI relationship provides potential additional value. Investors are increasingly focused on Microsoft’s stake and commercial partnership with OpenAI, particularly ahead of a possible OpenAI initial public offering that could provide a market reference for the investment. OpenAI’s Future IPO Keeps Me Buying Microsoft
• Positive Sentiment: Microsoft introduced new real-time AI speech models for customer-service agents, multilingual assistants and voice interfaces. The products broaden Microsoft’s enterprise AI offering and could support additional cloud consumption and software revenue. Microsoft Targets Contact Center Market With Real-Time AI Voice Models
• Neutral Sentiment: Investors are awaiting Microsoft’s October 7 Surface and Windows event. New hardware or Windows updates could support the ecosystem, although the event has not yet produced a material earnings catalyst. Microsoft Stock Notches Up Ahead of the Surface Show
• Negative Sentiment: Risks include heavy AI capital spending, valuation concerns and broader market concentration. Critics argue that rising data-center capacity could pressure compute pricing and returns, while strategists warn that a market correction could disproportionately affect megacap technology stocks. Microsoft’s dividend remains affordable, but AI infrastructure spending and lease commitments could limit future dividend growth. Morgan Stanley Strategist Sees Market Drawdown Potential

Microsoft 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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