Microsoft Corporation (NASDAQ:MSFT) Receives Consensus Recommendation of "Moderate Buy" from Analysts

Key Points

• Microsoft has a consensus analyst rating of “Moderate Buy”, with 39 buy ratings and 7 hold ratings from 46 firms covering the stock. The average 12-month target price is about $560.88.
• The company posted a strong latest quarter, reporting $4.27 EPS versus the $4.06 estimate and $82.89 billion in revenue, both ahead of expectations. Revenue rose 18.3% year over year.
• Recent news around Microsoft has been mostly positive, including reports of a new AI coding model for Build and a $9.69 billion Pentagon software deal that strengthens its enterprise and government business.

Microsoft Corporation (NASDAQ:MSFT - Get Free Report) has received a consensus rating of "Moderate Buy" from the forty-six ratings firms that are presently covering the stock, Marketbeat.com reports. Seven research analysts have rated the stock with a hold rating and thirty-nine have given a buy rating to the company. The average 12-month target price among brokerages that have updated their coverage on the stock in the last year is $560.8837.

MSFT has been the subject of several research analyst reports. Tigress Financial lifted their price objective on Microsoft from $595.00 to $680.00 and gave the company a "buy" rating in a research report on Wednesday, May 6th. UBS Group restated a "buy" rating on shares of Microsoft in a report on Friday, April 24th. Mizuho cut their price target on Microsoft from $620.00 to $515.00 and set an "outperform" rating for the company in a report on Tuesday, April 14th. Robert W. Baird reduced their price target on shares of Microsoft from $540.00 to $500.00 and set an "outperform" rating on the stock in a research report on Wednesday, April 15th. Finally, Wells Fargo & Company increased their price objective on shares of Microsoft from $615.00 to $625.00 and gave the stock an "overweight" rating in a report on Thursday, April 30th.

Insider Activity at Microsoft

In other Microsoft news, EVP Kathleen T. Hogan sold 12,321 shares of the company's stock in a transaction on Friday, March 6th. The stock was sold at an average price of $409.52, for a total transaction of $5,045,695.92. Following the transaction, the executive vice president owned 137,933 shares of the company's stock, valued at approximately $56,486,322.16. This represents a 8.20% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through the SEC website. Also, EVP Amy Coleman sold 1,262 shares of the stock in a transaction on Thursday, May 14th. The shares were sold at an average price of $411.34, for a total value of $519,111.08. Following the completion of the transaction, the executive vice president owned 46,003 shares in the company, valued at $18,922,874.02. The trade was a 2.67% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. 0.03% of the stock is owned by corporate insiders.

Institutional Trading of Microsoft

Institutional investors and hedge funds have recently added to or reduced their stakes in the company. Longfellow Investment Management Co. LLC lifted its holdings in Microsoft by 51.3% in the second quarter. Longfellow Investment Management Co. LLC now owns 59 shares of the software giant's stock valued at $29,000 after buying an additional 20 shares during the period. Bernzott Capital Advisors acquired a new stake in Microsoft during the 4th quarter worth $34,000. Bayforest Capital Ltd acquired a new stake in Microsoft during the 3rd quarter worth $38,000. Timmons Wealth Management LLC bought a new stake in shares of Microsoft during the 4th quarter valued at $36,000. Finally, Fairway Wealth LLC raised its position in shares of Microsoft by 287.0% during the 4th quarter. Fairway Wealth LLC now owns 89 shares of the software giant's stock valued at $43,000 after acquiring an additional 66 shares during the last quarter. 71.13% of the stock is owned by institutional investors.

Key Microsoft News

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Microsoft is expected to showcase new homegrown AI models at Build, including a coding model that could improve GitHub Copilot and support future developer adoption. Microsoft to release new coding model next week, the Information reports
• Positive Sentiment: Wall Street commentary is turning more bullish on Microsoft’s AI revenue potential, with Morgan Stanley and HSBC both suggesting the market may be underestimating future upside from Azure, Copilot, and the Anthropic relationship. Is Wall Street underestimating MSFT AI revenue potential? Morgan Stanley weighs in
• Positive Sentiment: Microsoft also benefited from a broad tech rally, with AI and software stocks leading the market higher late in the session. Sector Update: Tech Stocks Rise Late Afternoon
• Positive Sentiment: Microsoft secured a five-year $9.69 billion Pentagon software deal that consolidates government licensing and reinforces its entrenched enterprise and public-sector position. Pentagon awards Microsoft $9.7 billion deal in bid to cut costs, end license sprawl
• Neutral Sentiment: Some articles also note Microsoft’s heavy AI spending and the risk of capital misallocation across the sector, which could keep valuation debates active even as the stock trends higher. Peter Schiff: The $1 Trillion AI CapEx Bubble Is Hiding a Massive Capital Misallocation

Microsoft Stock Performance

NASDAQ MSFT opened at $426.99 on Friday. The firm has a market cap of $3.17 trillion, a price-to-earnings ratio of 25.42, a PEG ratio of 1.49 and a beta of 1.10. The company has a 50 day moving average of $400.93 and a 200-day moving average of $434.51. The company has a current ratio of 1.28, a quick ratio of 1.27 and a debt-to-equity ratio of 0.08. Microsoft has a 1-year low of $356.28 and a 1-year high of $555.45.

Microsoft (NASDAQ:MSFT - Get Free Report) last announced its earnings results on Wednesday, April 29th. The software giant reported $4.27 EPS for the quarter, topping the consensus estimate of $4.06 by $0.21. Microsoft had a return on equity of 31.94% and a net margin of 39.34%.The business had revenue of $82.89 billion for the quarter, compared to the consensus estimate of $81.44 billion. During the same period in the previous year, the business earned $3.46 EPS. Microsoft's revenue was up 18.3% compared to the same quarter last year. On average, equities analysts forecast that Microsoft will post 16.76 earnings per share for the current fiscal year.

Microsoft Dividend Announcement

The business also recently announced a quarterly dividend, which will be paid on Thursday, June 11th. Stockholders of record on Thursday, May 21st will be given a dividend of $0.91 per share. This represents a $3.64 dividend on an annualized basis and a dividend yield of 0.9%. The ex-dividend date is Thursday, May 21st. Microsoft's dividend payout ratio is presently 21.67%.

About Microsoft

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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