Microsoft Corporation $MSFT Position Increased by Arrowstreet Capital Limited Partnership

Key Points

• Arrowstreet Capital increased its Microsoft position by 64.3% in the first quarter, adding 9.5 million shares to reach 24.3 million shares worth approximately $9.0 billion. Microsoft now represents 4.9% of Arrowstreet’s portfolio and institutional investors own 71.13% of the stock.
• Microsoft exceeded quarterly expectations, reporting $4.74 in EPS and $90.01 billion in revenue, up 17.7% year over year. The company will pay a quarterly dividend of $0.91, while analysts maintain a “Moderate Buy” consensus and an average price target of $558.87.
• Despite strong AI and Azure growth prospects, investors face risks from rising data-center spending, potentially lower cloud margins, customer concentration and recent insider selling. Microsoft shares opened at $499.99, near the upper end of their 52-week range.

Arrowstreet Capital Limited Partnership increased its holdings in Microsoft Corporation (NASDAQ:MSFT - Free Report) by 64.3% during the 1st quarter, according to the company in its most recent disclosure with the SEC. The institutional investor owned 24,264,779 shares of the software giant's stock after acquiring an additional 9,493,778 shares during the quarter. Microsoft makes up 4.9% of Arrowstreet Capital Limited Partnership's portfolio, making the stock its biggest position. Arrowstreet Capital Limited Partnership owned 0.33% of Microsoft worth $8,982,083,000 as of its most recent SEC filing.

Other hedge funds have also recently bought and sold shares of the company. Longfellow Investment Management Co. LLC boosted its stake in Microsoft by 51.3% during the 2nd quarter. Longfellow Investment Management Co. LLC now owns 59 shares of the software giant's stock valued at $29,000 after acquiring an additional 20 shares during the last quarter. Bernzott Capital Advisors acquired a new stake in shares of Microsoft in the 4th quarter valued at about $34,000. Timmons Wealth Management LLC acquired a new stake in shares of Microsoft in the 4th quarter valued at about $36,000. Fairway Wealth LLC grew its position in shares of Microsoft by 287.0% in the 4th quarter. Fairway Wealth LLC now owns 89 shares of the software giant's stock worth $43,000 after acquiring an additional 66 shares in the last quarter. Finally, University of Illinois Foundation bought a new position in Microsoft during the second quarter worth $50,000. Institutional investors and hedge funds own 71.13% of the company's stock.

Microsoft Price Performance

MSFT stock opened at $499.99 on Monday. The firm's 50-day moving average is $404.86 and its two-hundred day moving average is $406.59. The company has a market capitalization of $3.71 trillion, a price-to-earnings ratio of 27.84, a price-to-earnings-growth ratio of 1.61 and a beta of 1.10. Microsoft Corporation has a 52 week low of $349.20 and a 52 week high of $553.72. The company has a current ratio of 1.23, a quick ratio of 1.22 and a debt-to-equity ratio of 0.07.

Microsoft (NASDAQ:MSFT - Get Free Report) last posted its quarterly earnings data 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. Microsoft had a net margin of 40.31% and a return on equity of 31.98%. The business had revenue of $90.01 billion during the quarter, compared to analysts' expectations of $87.62 billion. During the same period last year, the firm posted $3.65 earnings per share. The business's revenue was up 17.7% on a year-over-year basis. On average, analysts forecast that Microsoft Corporation will post 19.58 earnings per share for the current fiscal year.

Microsoft Announces Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Thursday, September 10th. Stockholders of record on Thursday, August 20th will be paid a $0.91 dividend. This represents a $3.64 dividend on an annualized basis and a dividend yield of 0.7%. The ex-dividend date of this dividend is Thursday, August 20th. Microsoft's payout ratio is currently 20.27%.

Insider Activity

In other news, EVP Amy Coleman sold 1,262 shares of the firm's stock in a transaction dated Thursday, May 14th. The shares were sold at an average price of $411.34, for a total transaction of $519,111.08. Following the completion of the transaction, the executive vice president owned 46,003 shares in the company, valued at approximately $18,922,874.02. This trade represents a 2.67% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is accessible through this link. Also, EVP Takeshi Numoto sold 4,810 shares of the stock in a transaction that occurred on Tuesday, August 4th. The shares were sold at an average price of $496.48, for a total transaction of $2,388,068.80. Following the sale, the executive vice president directly owned 42,677 shares of the company's stock, valued at approximately $21,188,276.96. This represents a 10.13% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders sold a total of 38,572 shares of company stock worth $17,775,330 over the last 90 days. 0.03% of the stock is currently owned by company insiders.

Wall Street Analyst Weigh In

A number of equities analysts have commented on MSFT shares. President Capital lifted their price objective on shares of Microsoft from $500.00 to $520.00 and gave the stock a "buy" rating in a report on Thursday, April 30th. HSBC reduced their price target on shares of Microsoft from $593.00 to $571.00 in a research report on Thursday, April 30th. Arete Research lifted their price target on shares of Microsoft from $730.00 to $870.00 and gave the company a "buy" rating in a report on Tuesday, May 5th. Tigress Financial boosted their price objective on shares of Microsoft from $680.00 to $690.00 and gave the company a "buy" rating in a research report on Wednesday. Finally, Citigroup reiterated a "buy" rating and set a $600.00 price objective (up from $570.00) on shares of Microsoft in a research note on Tuesday, July 28th. Forty-two equities research analysts have rated the stock with a Buy rating and five have assigned a Hold rating to the company. According to data from MarketBeat.com, the stock currently has a consensus rating of "Moderate Buy" and an average target price of $558.87.

Key Stories Impacting Microsoft

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Citi raised its Microsoft price target to $600. The upgrade follows Microsoft’s quarterly Azure performance, with analysts highlighting the 43% cloud-revenue increase and stronger-than-expected earnings as evidence that AI demand is translating into accelerating cloud growth. Citi Raises Microsoft Stock Target to $600
• Positive Sentiment: Microsoft’s custom AI chips may improve cloud economics. CEO Satya Nadella said the company’s internally developed chips can deliver efficiency gains of up to 40%. Better cost and energy efficiency could help Microsoft support AI workloads while protecting Azure margins. Microsoft Custom AI Chips Improve Efficiency
• Positive Sentiment: Azure is expanding in India. Microsoft opened a major Hyderabad data-center region and is committing approximately $20.5 billion to its Indian cloud and AI operations. Early customers include Adani Group and HDFC Bank, supporting the case for long-term international Azure growth. Microsoft Opens Largest India Data Center Hub
• Positive Sentiment: Fundamentals and institutional support remain strong. Microsoft recently exceeded quarterly revenue and EPS expectations, while Bill Ackman’s Pershing Square holds a reported $2.4 billion MSFT position. Scotiabank also raised its fiscal 2027 EPS estimate and maintained an Outperform rating. Bill Ackman Microsoft Stake
• Neutral Sentiment: AI demand is powerful but concentrated. Reports suggest OpenAI may account for a substantial portion of Microsoft’s AI sales, creating both a major growth engine and customer-concentration risk. Microsoft’s large AI backlog also does not guarantee equivalent future profitability.
• Negative Sentiment: Spending, margins and valuation remain concerns. Rising data-center capital expenditures and lower cloud gross margins could pressure cash flow if AI infrastructure costs grow faster than revenue. After the sharp post-earnings rally, the stock is also more vulnerable to profit-taking or disappointing guidance.
• Negative Sentiment: Insider sales and securities litigation add headline risk. CEO Judson Althoff sold 10,000 shares for roughly $4.9 million, and multiple law firms are publicizing a securities class action with an August 11 lead-plaintiff deadline. These developments do not establish wrongdoing but may weigh on near-term sentiment.

Microsoft Company Profile

Microsoft Corporation is a global technology company headquartered in Redmond, Washington. Founded in 1975 by Bill Gates and Paul Allen, Microsoft develops, licenses and supports a broad range of software products, services and devices for consumers, enterprises and governments worldwide. Its operations span personal computing, productivity software, cloud infrastructure, enterprise applications, developer tools and gaming.

Microsoft's product portfolio includes the Windows operating system and the Microsoft 365 suite of productivity and collaboration tools (Office apps, Outlook, Teams).

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