Lakewood Capital Management LP Buys 101,534 Shares of Microsoft Corporation $MSFT

Key Points

• Lakewood Capital Management initiated a Microsoft position of 101,534 shares worth approximately $37.9 million, representing about 2% of its portfolio. Institutional investors collectively own 71.13% of Microsoft.
• Microsoft reported strong quarterly results, with revenue up 17.7% year over year and earnings per share exceeding estimates. Analysts maintain a “Moderate Buy” consensus, with an average price target of $589.71.
• AI expansion remains a key focus: Microsoft is securing power for future data centers and developing custom chips, though rising infrastructure costs, potential regulatory action and margin pressure remain risks.

Lakewood Capital Management LP bought a new stake in Microsoft Corporation (NASDAQ:MSFT - Free Report) during the 2nd quarter, according to the company in its most recent Form 13F filing with the Securities & Exchange Commission. The institutional investor bought 101,534 shares of the software giant's stock, valued at approximately $37,874,000. Microsoft accounts for about 2.0% of Lakewood Capital Management LP's portfolio, making the stock its 19th biggest position.

A number of other large investors have also recently made changes to their positions in the company. Legal & General Group Plc purchased a new position in Microsoft in the 2nd quarter worth about $18,306,443,000. The Manufacturers Life Insurance Company purchased a new stake in Microsoft in the 2nd quarter valued at about $4,000,706,000. Kelly Lawrence W & Associates Inc. CA purchased a new stake in Microsoft in the 2nd quarter valued at about $2,374,000. Sone Capital Management LLC bought a new position in Microsoft in the 2nd quarter worth about $30,533,000. Finally, Trajan Wealth LLC bought a new position in Microsoft in the 2nd quarter worth about $103,382,000. 71.13% of the stock is owned by hedge funds and other institutional investors.

More Microsoft News

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Analysts expect Microsoft to remain the only major hyperscaler with positive free cash flow over the next year despite heavy AI investment. This reinforces confidence that the company can fund data-center expansion without substantial external financing. Microsoft Free Cash Flow Expected to Remain Positive
• Positive Sentiment: Microsoft signed a 20-year agreement with NiSource for approximately 1,100 megawatts of power for an Indiana data-center campus beginning in 2028. Securing electricity supports future Azure capacity as grid constraints become a bottleneck for AI expansion. Microsoft Signs Power Deal With NiSource
• Positive Sentiment: Microsoft’s custom Maia AI chips and reports that a new model achieved comparable or better performance than OpenAI’s system using a fraction of the computing power could eventually reduce reliance on expensive third-party GPUs and improve AI economics. Microsoft Wants to Make AI Cheaper
• Neutral Sentiment: Investors are focused on Azure growth, Copilot adoption, AI monetization and capital expenditures ahead of earnings. Strong demand could support the shares, but the market wants evidence that revenue growth is translating into sustainable margins.
• Negative Sentiment: The U.K. Competition and Markets Authority is investigating Microsoft’s grip on business software and says Microsoft and Amazon Web Services may need to do more to address cloud-service barriers. Potential remedies could increase compliance costs or weaken customer-lock-in advantages. UK Regulator Targets Microsoft’s Business Software Grip
• Negative Sentiment: Questions remain over whether custom chips will deliver meaningful savings: AI infrastructure, power and data-center commitments are rising rapidly, while Microsoft is reportedly seeking substantial cost reductions in Azure. That creates concern about near-term free-cash-flow and margin pressure.

Wall Street Analyst Weigh In

Several analysts have recently weighed in on MSFT shares. Citizens Jmp reaffirmed a "market outperform" rating and set a $550.00 price target on shares of Microsoft in a research note on Tuesday, September 15th. Guggenheim reissued a "buy" rating and issued a $586.00 price objective on shares of Microsoft in a research note on Monday, July 27th. Wolfe Research cut Microsoft from an "outperform" rating to a "hold" rating in a research note on Wednesday, September 23rd. KeyCorp restated an "overweight" rating on shares of Microsoft in a report on Thursday, September 3rd. Finally, Melius Research set a $665.00 target price on Microsoft and gave the company a "buy" rating in a research report on Monday, October 5th. Forty-two research analysts have rated the stock with a Buy rating, four have given a Hold rating and two have issued a Sell rating to the company's stock. According to MarketBeat.com, Microsoft currently has a consensus rating of "Moderate Buy" and an average target price of $589.71.

Microsoft Stock Performance

MSFT stock opened at $529.05 on Monday. The firm has a market cap of $3.93 trillion, a price-to-earnings ratio of 29.46, a PEG ratio of 1.70 and a beta of 1.10. The firm has a 50-day simple moving average of $505.53 and a two-hundred day simple moving average of $441.16. Microsoft Corporation has a one year low of $349.20 and a one year 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.

Microsoft (NASDAQ:MSFT - Get Free Report) last released its quarterly earnings results on Wednesday, July 29th. The software giant reported $4.74 earnings per share for the quarter, beating analysts' consensus estimates of $4.24 by $0.50. Microsoft had a net margin of 40.31% and a return on equity of 31.98%. The business had revenue of $90.01 billion for the quarter, compared to analysts' expectations of $87.62 billion. During the same period last year, the business earned $3.65 EPS. The company's revenue was up 17.7% compared to the same quarter last year. On average, equities analysts forecast that Microsoft Corporation will post 19.65 EPS for the current fiscal 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 $0.98 dividend. This is an increase from Microsoft's previous quarterly dividend of $0.91. This represents a $3.92 annualized dividend and a yield of 0.7%. The ex-dividend date of this dividend is Thursday, November 19th. Microsoft's dividend payout ratio is presently 20.27%.

Insider Activity

In other Microsoft news, 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 completion of the sale, the executive vice president owned 533,624 shares of the company's stock, valued at approximately $265,888,830.48. This trade represents a 7.24% decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Judson Althoff sold 10,000 shares of the firm's stock in a transaction dated 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 position. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold a total of 150,314 shares of company stock valued at $75,404,992 over the last three months. Company insiders own 0.03% of the company's stock.

Microsoft Company 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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