RDST Capital LLC Makes New $62.42 Million Investment in Microsoft Corporation $MSFT

Key Points

• RDST Capital LLC acquired 167,344 Microsoft shares worth approximately $62.42 million in the second quarter, making Microsoft about 5.2% of its portfolio. Institutional investors collectively own 71.13% of Microsoft.
• Microsoft reported quarterly EPS of $4.74 and revenue of $90.01 billion, surpassing analyst expectations, while revenue rose 17.7% year over year. Analysts maintain a consensus “Moderate Buy” rating with an average price target of $589.71.
• Microsoft increased its quarterly dividend to $0.98 per share, or $3.92 annualized, representing a 0.7% yield. Meanwhile, insiders sold approximately $75.4 million of company stock over the past 90 days, including sales by CEO Satya Nadella and EVP Takeshi Numoto.

RDST Capital LLC bought a new stake in Microsoft Corporation (NASDAQ:MSFT - Free Report) during the 2nd quarter, according to the company in its most recent filing with the Securities & Exchange Commission. The fund bought 167,344 shares of the software giant's stock, valued at approximately $62,423,000. Microsoft comprises about 5.2% of RDST Capital LLC's investment portfolio, making the stock its 12th largest holding.

Other institutional investors and hedge funds also recently added to or reduced their stakes in the company. Empirical Financial Services LLC d.b.a. Empirical Wealth Management increased its position in Microsoft by 4.0% during 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 in the last quarter. D.B. Root & Company LLC acquired a new stake in Microsoft in the second quarter worth about $3,652,000. Markel Group Inc. boosted its holdings in Microsoft by 0.4% in the first quarter. Markel Group Inc. now owns 537,630 shares of the software giant's stock worth $199,014,000 after acquiring an additional 1,950 shares in the last quarter. Bessemer Group Inc. grew its stake in shares of Microsoft by 8.4% during the first quarter. Bessemer Group Inc. now owns 6,921,677 shares of the software giant's stock worth $2,562,197,000 after acquiring an additional 537,634 shares during the last quarter. Finally, Taylor Securities Services Inc. purchased a new stake in shares of Microsoft during the fourth quarter worth about $2,616,000. Hedge funds and other institutional investors own 71.13% of the company's stock.

Analyst Ratings Changes

Several research firms have weighed in on MSFT. Melius Research set a $665.00 target price on shares of Microsoft and gave the stock a "buy" rating in a research report on Monday, October 5th. Truist Financial reaffirmed a "buy" rating and issued a $575.00 price target on shares of Microsoft in a report on Wednesday, July 22nd. The Goldman Sachs Group reaffirmed a "buy" rating and issued a $640.00 price target on shares of Microsoft in a report on Thursday, July 30th. Needham & Company LLC started coverage on shares of Microsoft in a research note on Wednesday, September 23rd. They set a "buy" rating for the company. Finally, Deutsche Bank Aktiengesellschaft reissued a "buy" rating and set a $600.00 price objective on shares of Microsoft in a report on Monday, October 12th. 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, Microsoft has a consensus rating of "Moderate Buy" and an average price target of $589.71.

Insider Buying and Selling

In other Microsoft news, EVP Takeshi Numoto sold 4,810 shares of the business's stock in a transaction dated Tuesday, August 4th. The shares were sold at an average price of $496.48, for a total value of $2,388,068.80. Following the transaction, the executive vice president directly owned 42,677 shares in the company, valued at $21,188,276.96. The trade was a 10.13% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is available through the SEC website. Also, CEO Satya Nadella sold 86,525 shares of the business's stock in a transaction dated Tuesday, September 1st. The shares were sold at an average price of $501.46, for a total transaction of $43,388,826.50. Following the completion of the transaction, the chief executive officer owned 486,763 shares in the company, valued at $244,092,173.98. The trade was a 15.09% decrease in their ownership of the stock. 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. In the last ninety days, insiders have sold 150,314 shares of company stock worth $75,404,992. 0.03% of the stock is owned by corporate insiders.

Microsoft Stock Performance

MSFT opened at $529.05 on Monday. The firm has a fifty day moving average price of $505.53 and a 200 day moving average price of $441.16. Microsoft Corporation has a 1 year low of $349.20 and a 1 year high of $553.72. The stock has a market cap of $3.93 trillion, a P/E ratio of 29.46, a P/E/G ratio of 1.70 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 (NASDAQ:MSFT - Get Free Report) last issued its quarterly earnings data on Wednesday, July 29th. The software giant reported $4.74 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 analyst estimates of $87.62 billion. Microsoft had a return on equity of 31.98% and a net margin of 40.31%. Microsoft's quarterly revenue was up 17.7% compared to the same quarter last year. During the same period last year, the company earned $3.65 earnings per share. Equities research analysts anticipate that Microsoft Corporation will post 19.65 earnings per share for the current year.

Microsoft Increases Dividend

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

Key Stories Impacting Microsoft

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.

Microsoft 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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