Microsoft (NASDAQ:MSFT) Stock Price Up 3.5% - What's Next?

Key Points

• Microsoft shares rose 3.5% in mid-day trading, with volume running above average as investors pushed the stock to an intraday high of $429.49.
• Sentiment remains positive on Microsoft’s AI and cloud growth story, helped by expectations for a new in-house coding model at Build, upbeat analyst commentary, and continued enthusiasm around Azure and Copilot monetization.
• The company also secured a five-year, $9.69 billion Pentagon software contract, reinforcing its enterprise and government-cloud strength while analysts largely maintain a bullish view on the stock.

Microsoft Corporation (NASDAQ:MSFT - Get Free Report)'s stock price rose 3.5% during mid-day trading on Thursday . The company traded as high as $429.49 and last traded at $426.99. Approximately 45,425,063 shares changed hands during mid-day trading, an increase of 29% from the average daily volume of 35,262,738 shares. The stock had previously closed at $412.67.

Trending Headlines about Microsoft

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Microsoft is expected to unveil a new in-house coding model at next week’s Build conference, which could strengthen GitHub Copilot and improve its competitive position in AI developer tools. Microsoft to release new coding model next week, the Information reports
• Positive Sentiment: Wall Street sentiment is staying constructive, with Piper Sandler, KeyBanc, HSBC and other firms reiterating bullish views tied to Azure, Copilot, and Microsoft’s AI monetization potential. ‘Time to Pull the Trigger,’ Says Piper Sandler About Microsoft Stock
• Positive Sentiment: Microsoft also won a five-year, $9.69 billion Pentagon software contract, reinforcing its government-cloud and enterprise software moat. Pentagon awards Microsoft $9.7 billion deal in bid to cut costs, end license sprawl
• Positive Sentiment: Analyst commentary highlighted Microsoft’s AI revenue runway, including Morgan Stanley’s view that the company may still be early in monetizing its AI infrastructure and HSBC’s estimate that the Anthropic relationship could add billions in Azure revenue by 2030. Microsoft Stock Climbs as AI Revenue Run Rate Tops $37 Billion
• Neutral Sentiment: Microsoft’s stock is also benefiting from broader AI-infrastructure enthusiasm across the market, with investors rotating toward companies seen as core beneficiaries of enterprise AI buildout. Market Indexes Rise on Microsoft Momentum
• Neutral Sentiment: Recent commentary also notes that Microsoft is spending heavily on AI, which supports long-term growth but keeps some investors cautious about near-term margins and capital intensity. Microsoft Is Spending Billions on AI, But Investors Aren’t Buying It

Wall Street Analysts Forecast Growth

MSFT has been the subject of a number of recent research reports. Benchmark reissued a "buy" rating and issued a $525.00 target price (up from $450.00) on shares of Microsoft in a research report on Tuesday, April 28th. Phillip Securities upgraded Microsoft to a "buy" rating and set a $485.00 price target for the company in a research report on Wednesday, May 13th. Wells Fargo & Company lifted their price target on Microsoft from $615.00 to $625.00 and gave the company an "overweight" rating in a research report on Thursday, April 30th. Sanford C. Bernstein lifted their price target on Microsoft from $641.00 to $646.00 and gave the company an "outperform" rating in a research report on Thursday, April 30th. Finally, Truist Financial reduced their price target on Microsoft from $675.00 to $575.00 and set a "buy" rating for the company in a research report on Thursday, April 30th. Thirty-nine equities research analysts have rated the stock with a Buy rating and seven have given a Hold rating to the company. According to MarketBeat.com, Microsoft has a consensus rating of "Moderate Buy" and a consensus target price of $560.88.

Microsoft Stock Performance

The company has a market capitalization of $3.17 trillion, a PE ratio of 25.42, a PEG ratio of 1.50 and a beta of 1.10. The company has a quick ratio of 1.27, a current ratio of 1.28 and a debt-to-equity ratio of 0.08. The company has a 50-day moving average price of $400.37 and a two-hundred day moving average price of $435.01.

Microsoft (NASDAQ:MSFT - Get Free Report) last posted 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 during the quarter, compared to analysts' expectations of $81.44 billion. During the same period in the previous year, the business earned $3.46 earnings per share. The firm's revenue was up 18.3% on a year-over-year basis. Analysts predict that Microsoft Corporation will post 16.76 EPS for the current fiscal year.

Microsoft Announces Dividend

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

Insider Activity

In related news, EVP Amy Coleman sold 1,262 shares of the business's stock in a transaction dated Thursday, May 14th. The stock was 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 directly 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. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, EVP Kathleen T. Hogan sold 12,321 shares of the business's stock in a transaction dated Friday, March 6th. The stock was sold at an average price of $409.52, for a total value 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. The trade was a 8.20% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. 0.03% of the stock is owned by insiders.

Hedge Funds Weigh In On Microsoft

Several hedge funds and other institutional investors have recently added to or reduced their stakes in MSFT. BLVD Private Wealth LLC lifted its stake in Microsoft by 0.6% during the third quarter. BLVD Private Wealth LLC now owns 3,169 shares of the software giant's stock worth $1,641,000 after purchasing an additional 19 shares during the last quarter. Magnolia Capital Management Ltd. boosted its stake in shares of Microsoft by 0.3% in the 3rd quarter. Magnolia Capital Management Ltd. now owns 6,509 shares of the software giant's stock valued at $3,371,000 after purchasing an additional 20 shares in the last quarter. ARK & TLK Investments LLC boosted its stake in shares of Microsoft by 1.0% in the 3rd quarter. ARK & TLK Investments LLC now owns 1,935 shares of the software giant's stock valued at $1,002,000 after purchasing an additional 20 shares in the last quarter. Rochester Wealth Strategies LLC boosted its stake in shares of Microsoft by 2.9% in the 3rd quarter. Rochester Wealth Strategies LLC now owns 700 shares of the software giant's stock valued at $363,000 after purchasing an additional 20 shares in the last quarter. Finally, Longfellow Investment Management Co. LLC boosted its stake in shares of Microsoft by 51.3% in the 2nd quarter. Longfellow Investment Management Co. LLC now owns 59 shares of the software giant's stock valued at $29,000 after purchasing an additional 20 shares in the last quarter. 71.13% of the stock is currently owned by hedge funds and other institutional investors.

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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