Microsoft (NASDAQ:MSFT) Shares Down 1.6% - Here's What Happened

Key Points

• Microsoft's shares dropped by 1.6%, trading at $508.81, with a significant decline in trading volume of 78% compared to its average.
• Analysts have raised their price targets for Microsoft, with Piper Sandler setting it at $650.00, while the average price target is now $612.54, indicating a general bullish sentiment.
• The company announced a quarterly dividend of $0.83 per share, to be paid on September 11th, representing a 0.6% dividend yield.

Microsoft Corporation (NASDAQ:MSFT - Get Free Report) was down 1.6% during trading on Tuesday . The company traded as low as $510.34 and last traded at $508.81. Approximately 4,811,490 shares traded hands during trading, a decline of 78% from the average daily volume of 22,181,881 shares. The stock had previously closed at $517.10.

Wall Street Analyst Weigh In

A number of equities research analysts have commented on MSFT shares. Piper Sandler raised their target price on shares of Microsoft from $600.00 to $650.00 and gave the stock an "overweight" rating in a research note on Thursday, July 31st. Evercore ISI lifted their price objective on shares of Microsoft from $515.00 to $545.00 and gave the company an "outperform" rating in a research report on Friday, July 25th. Bank of America lifted their price objective on shares of Microsoft from $585.00 to $640.00 and gave the company a "buy" rating in a research report on Thursday, July 31st. Needham & Company LLC reiterated a "buy" rating on shares of Microsoft in a research report on Thursday, May 1st. Finally, TD Securities lifted their price objective on shares of Microsoft from $475.00 to $490.00 and gave the company a "buy" rating in a research report on Thursday, May 1st. One analyst has rated the stock with a Strong Buy rating, twenty-nine have given a Buy rating and two have assigned a Hold rating to the company's stock. Based on data from MarketBeat.com, the company presently has a consensus rating of "Moderate Buy" and an average price target of $612.54.

Microsoft Price Performance

The company has a debt-to-equity ratio of 0.12, a current ratio of 1.35 and a quick ratio of 1.35. The firm has a fifty day moving average of $503.49 and a two-hundred day moving average of $441.90. The stock has a market capitalization of $3.80 trillion, a P/E ratio of 37.52, a P/E/G ratio of 2.28 and a beta of 1.06.

Microsoft (NASDAQ:MSFT - Get Free Report) last announced its earnings results on Wednesday, July 30th. The software giant reported $3.65 EPS for the quarter, topping analysts' consensus estimates of $3.35 by $0.30. The business had revenue of $76.44 billion during the quarter, compared to the consensus estimate of $73.79 billion. Microsoft had a net margin of 36.15% and a return on equity of 32.44%. The firm's revenue was up 18.1% on a year-over-year basis. During the same period in the previous year, the company posted $2.95 earnings per share. Microsoft has set its Q1 2026 guidance at EPS. On average, analysts predict that Microsoft Corporation will post 13.08 EPS for the current year.

Microsoft Announces Dividend

The business also recently disclosed a quarterly dividend, which will be paid on Thursday, September 11th. Stockholders of record on Thursday, August 21st will be issued a dividend of $0.83 per share. The ex-dividend date is Thursday, August 21st. This represents a $3.32 annualized dividend and a dividend yield of 0.6%. Microsoft's dividend payout ratio is 24.34%.

Insider Activity

In related news, EVP Kathleen T. Hogan sold 21,500 shares of the company's stock in a transaction that occurred on Wednesday, May 21st. The stock was sold at an average price of $453.77, for a total value of $9,756,055.00. Following the sale, the executive vice president owned 134,888 shares in the company, valued at $61,208,127.76. This represents a 13.75% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, EVP Takeshi Numoto sold 4,850 shares of the company's stock in a transaction that occurred on Tuesday, August 12th. The stock was sold at an average price of $527.32, for a total value of $2,557,502.00. Following the completion of the sale, the executive vice president owned 39,111 shares in the company, valued at approximately $20,624,012.52. This represents a 11.03% decrease in their position. The disclosure for this sale can be found here. In the last 90 days, insiders have sold 30,350 shares of company stock worth $14,162,567. Corporate insiders own 0.03% of the company's stock.

Institutional Investors Weigh In On Microsoft

Institutional investors and hedge funds have recently modified their holdings of the stock. Norges Bank acquired a new position in shares of Microsoft in the 4th quarter worth $44,343,058,000. Kingstone Capital Partners Texas LLC increased its stake in Microsoft by 564,387.1% during the second quarter. Kingstone Capital Partners Texas LLC now owns 90,549,369 shares of the software giant's stock valued at $45,040,162,000 after acquiring an additional 90,533,328 shares during the period. Nuveen LLC bought a new stake in shares of Microsoft in the 1st quarter valued at approximately $18,733,827,000. GAMMA Investing LLC boosted its position in Microsoft by 40,290.4% in the 1st quarter. GAMMA Investing LLC now owns 46,695,303 shares of the software giant's stock valued at $17,528,950,000 after buying an additional 46,579,693 shares during the last quarter. Finally, Laurel Wealth Advisors LLC boosted its position in shares of Microsoft by 49,640.3% in the 2nd quarter. Laurel Wealth Advisors LLC now owns 29,967,038 shares of the software giant's stock worth $14,905,904,000 after purchasing an additional 29,906,791 shares during the last quarter. Hedge funds and other institutional investors own 71.13% of the company's stock.

Microsoft Company Profile

Microsoft Corporation develops and supports software, services, devices and solutions worldwide. The Productivity and Business Processes segment offers office, exchange, SharePoint, Microsoft Teams, office 365 Security and Compliance, Microsoft viva, and Microsoft 365 copilot; and office consumer services, such as Microsoft 365 consumer subscriptions, Office licensed on-premises, and other office services.

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