PCM Encore LLC Makes New Investment in Microsoft Corporation $MSFT

Key Points

• PCM Encore LLC acquired 46,079 Microsoft shares worth approximately $17.2 million in the second quarter, making Microsoft its sixth-largest holding and about 3% of its portfolio.
• Institutional investors and hedge funds own 71.13% of Microsoft, while insiders sold 143,009 shares worth about $71.4 million during the latest quarter.
• Microsoft reported strong quarterly results, with revenue up 17.7% year over year and EPS exceeding estimates. Analysts maintain a “Moderate Buy” consensus with an average price target of $579.84, while the company raised its quarterly dividend to $0.98 per share.

PCM Encore LLC acquired a new position in shares of Microsoft Corporation (NASDAQ:MSFT - Free Report) in the 2nd quarter, according to its most recent disclosure with the SEC. The fund acquired 46,079 shares of the software giant's stock, valued at approximately $17,188,000. Microsoft comprises approximately 3.0% of PCM Encore LLC's investment portfolio, making the stock its 6th largest position.

A number of other institutional investors and hedge funds have also recently modified their holdings of MSFT. Empirical Financial Services LLC d.b.a. Empirical Wealth Management grew its position in shares of Microsoft by 4.0% in the 2nd quarter. Empirical Financial Services LLC d.b.a. Empirical Wealth Management now owns 229,490 shares of the software giant's stock valued at $85,604,000 after buying an additional 8,773 shares during the last quarter. Markel Group Inc. lifted its position in Microsoft by 0.4% in the first quarter. Markel Group Inc. now owns 537,630 shares of the software giant's stock valued at $199,014,000 after acquiring an additional 1,950 shares during the last quarter. Bessemer Group Inc. lifted its position in Microsoft by 8.4% in the first quarter. Bessemer Group Inc. now owns 6,921,677 shares of the software giant's stock valued at $2,562,197,000 after acquiring an additional 537,634 shares during the last quarter. Taylor Securities Services Inc. acquired a new position in Microsoft in the fourth quarter valued at $2,616,000. Finally, Harel Insurance Investments & Financial Services Ltd. boosted its stake in Microsoft by 138.8% in the first quarter. Harel Insurance Investments & Financial Services Ltd. now owns 1,356,359 shares of the software giant's stock valued at $502,077,000 after acquiring an additional 788,297 shares in the last quarter. Institutional investors and hedge funds own 71.13% of the company's stock.

Insider Activity

In other Microsoft news, EVP Takeshi Numoto sold 4,810 shares of the company's stock in a transaction 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 completion of the transaction, the executive vice president owned 42,677 shares in the company, valued at approximately $21,188,276.96. This represents a 10.13% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, EVP Amy Hood sold 41,674 shares of the firm's stock in a transaction on Monday, September 14th. The stock was sold at an average price of $498.27, for a total transaction 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 $265,888,830.48. This trade represents a 7.24% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last quarter, insiders sold 143,009 shares of company stock valued at $71,420,699. 0.03% of the stock is owned by corporate insiders.

Key Headlines Impacting Microsoft

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Maia 300 AI chip is the key catalyst. Microsoft unveiled its third-generation Maia 300 processor and plans to begin production deployments in 2027, eventually scaling the platform to multiple gigawatts and potentially as many as one million chips. The company says Maia 300 can deliver approximately 40% more AI-generated tokens per megawatt or dollar than leading GPU-based systems, which could lower Azure costs and improve margins. Microsoft reveals Maia 300 AI chip
• Positive Sentiment: Greater control over AI supply and economics. Microsoft intends to make Maia a primary architecture for AI inference while continuing to use chips from Nvidia, AMD and Intel. Investors viewed the strategy as a way to reduce dependence on expensive, supply-constrained Nvidia hardware and strengthen Azure’s competitive position. Microsoft to rely more on homegrown AI chips
• Positive Sentiment: Underlying growth remains strong. Recent coverage points to Azure growth guidance of 44%–45%, rising Copilot adoption, a record backlog and more than $50 billion in quarterly capital spending to meet AI demand. These trends reinforce the bullish long-term case, although the October 28 earnings report will test whether growth remains above investor expectations.
• Neutral Sentiment: AI safety and infrastructure constraints remain in focus. CEO Satya Nadella and President Brad Smith called for stronger safeguards, emergency controls and clearer AI regulation. Separately, industry leaders highlighted electricity and cooling capacity as potential limits on AI expansion. These issues may increase compliance and infrastructure costs but could also benefit Microsoft’s enterprise-focused approach.
• Negative Sentiment: Regulatory and legal risks increased. The U.S. suspended Microsoft from the PERM green-card program amid scrutiny of its H-1B hiring practices, potentially complicating access to technical talent. Norway also fined Microsoft subsidiary Xandr approximately €8.6 million for sharing Grindr user data. Microsoft PERM suspension
• Negative Sentiment: Valuation and execution risks persist. Some analysts downgraded Microsoft amid concerns about elevated AI capital spending, high expectations and the need for Azure growth to remain above 40%. The departure of longtime science president Peter Lee is an additional, though relatively minor, leadership concern.

Analysts Set New Price Targets

A number of analysts have recently commented on MSFT shares. KeyCorp reiterated an "overweight" rating on shares of Microsoft in a research report on Thursday, September 3rd. Citizens Jmp reissued a "market outperform" rating and issued a $550.00 target price on shares of Microsoft in a research report on Tuesday, September 15th. Melius Research set a $665.00 price target on Microsoft and gave the stock a "buy" rating in a research note on Monday, October 5th. Argus cut their price target on Microsoft from $620.00 to $510.00 and set a "buy" rating on the stock in a research report on Friday, July 10th. Finally, Evercore raised Microsoft from an "underperform" rating to an "outperform" rating in a research report on Monday, October 5th. Forty-two equities research analysts have rated the stock with a Buy rating, four have assigned a Hold rating and two have issued a Sell rating to the company. Based on data from MarketBeat, Microsoft currently has a consensus rating of "Moderate Buy" and an average target price of $579.84.

Microsoft Stock Up 1.1%

Microsoft stock opened at $541.15 on Tuesday. Microsoft Corporation has a twelve month low of $349.20 and a twelve month high of $553.72. The stock has a 50 day moving average of $502.22 and a two-hundred day moving average of $436.28. The company has a current ratio of 1.23, a quick ratio of 1.22 and a debt-to-equity ratio of 0.07. The stock has a market capitalization of $4.02 trillion, a price-to-earnings ratio of 30.13, a PEG ratio of 1.72 and a beta of 1.10.

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

Microsoft Increases Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Thursday, December 10th. Investors of record on Thursday, November 19th will be given a $0.98 dividend. This is a positive change from Microsoft's previous quarterly dividend of $0.91. The ex-dividend date 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%.

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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