Microsoft (NASDAQ:MSFT) Trading 2.3% Higher - Time to Buy?

Key Points

• Microsoft shares rose 2.3% to $393.04 on Tuesday with volume slightly above average; the company recently beat quarterly estimates (EPS $4.14 vs. $3.86, revenue $81.27B) and carries a market cap of $2.92 trillion with a P/E of 24.58.
• Mixed AI developments are driving sentiment: analysts like Bernstein argue heavy AI capex could be temporary and a buying opportunity, Microsoft is shifting to sell Copilot as a standalone product to accelerate monetization, but reports that OpenAI is courting AWS pose a strategic risk to Microsoft’s Azure-centered AI positioning.
• Analyst sentiment is largely positive (consensus "Moderate Buy" and a consensus target of ~$580.87), yet several firms have trimmed price targets (e.g., Mizuho to $515, Wolfe to $530), highlighting near-term valuation and margin concerns.

Microsoft Corporation (NASDAQ:MSFT - Get Free Report) shares traded up 2.3% during trading on Tuesday . The stock traded as high as $394.69 and last traded at $393.04. 37,016,679 shares traded hands during trading, an increase of 4% from the average session volume of 35,500,340 shares. The stock had previously closed at $384.37.

Trending Headlines about Microsoft

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Analyst defense of AI spending — Bernstein and other bulls argue the heavy AI capex looks worse than it is and could be temporary, framing current weakness as a potential buying opportunity for long-term Azure/Copilot growth. 'This Looks Worse Than It Is,' Says Bernstein on Microsoft (MSFT) AI Spending
• Positive Sentiment: Monetization shift on Copilot — Microsoft is moving to sell Copilot as a standalone product after Wall Street feedback, which could accelerate direct revenue capture and improve visibility into AI monetization. Can Microsoft’s (MSFT) New Copilot Strategy Work In Its Favor?
• Positive Sentiment: Unusual options activity — Large call buying (over 800k contracts reported) signals some traders are positioning for an upside move into earnings, adding upward pressure to the equity.
• Neutral Sentiment: Product housekeeping: Outlook Lite sunset — Microsoft will shut down Outlook Lite on May 25, a modest customer transition story that has limited financial impact but may attract short-term user questions. Microsoft (MSFT) Axes Outlook Lite App, Users Forced to Switch Before Deadline
• Negative Sentiment: OpenAI / AWS developments — Reports and a leaked memo suggest OpenAI views the Microsoft tie-up as constraining and is courting Amazon/AWS, a development investors view as a material strategic risk to Microsoft’s exclusive‑access AI narrative and future Azure demand. AI Civil War: Amazon Wins as Microsoft's Empire Cracks (MSFT)
• Negative Sentiment: Analyst target cuts & capex focus — Firms have trimmed price targets (e.g., Mizuho lowered its target) and several pieces highlight investor focus on Microsoft’s very large AI capex plans ahead of the Q3 report — both press on near‑term valuation and margin expectations. Mizuho Trims Microsoft Price Target to $515: How Much Upside Is Left in This AI Titan?

Analyst Ratings Changes

MSFT has been the subject of several research analyst reports. DZ Bank reiterated a "buy" rating on shares of Microsoft in a report on Thursday, January 29th. Mizuho lowered their price target on shares of Microsoft from $620.00 to $515.00 and set an "outperform" rating for the company in a report on Tuesday. Rothschild & Co Redburn set a $450.00 price target on shares of Microsoft in a report on Wednesday, January 21st. Wolfe Research lowered their price target on shares of Microsoft from $625.00 to $530.00 and set an "outperform" rating for the company in a report on Thursday, January 29th. Finally, BMO Capital Markets lowered their price target on shares of Microsoft from $625.00 to $575.00 and set an "outperform" rating for the company in a report on Thursday, January 29th. Two research analysts have rated the stock with a Strong Buy rating, thirty-eight have given a Buy rating and five have given a Hold rating to the company's stock. According to MarketBeat, Microsoft has an average rating of "Moderate Buy" and a consensus target price of $580.87.

Microsoft Trading Up 2.3%

The company has a quick ratio of 1.38, a current ratio of 1.39 and a debt-to-equity ratio of 0.09. The company has a market cap of $2.92 trillion, a P/E ratio of 24.58, a PEG ratio of 1.41 and a beta of 1.11. The firm's 50 day moving average is $391.33 and its two-hundred day moving average is $456.51.

Microsoft (NASDAQ:MSFT - Get Free Report) last issued its quarterly earnings data on Wednesday, January 28th. The software giant reported $4.14 earnings per share for the quarter, topping the consensus estimate of $3.86 by $0.28. Microsoft had a net margin of 39.04% and a return on equity of 32.34%. The company had revenue of $81.27 billion for the quarter, compared to analysts' expectations of $80.28 billion. During the same quarter in the previous year, the firm posted $3.23 earnings per share. Microsoft's revenue for the quarter was up 16.7% on a year-over-year basis. As a group, equities research analysts anticipate that Microsoft Corporation will post 13.08 EPS for the current year.

Microsoft Dividend Announcement

The firm also recently disclosed a quarterly dividend, which will be paid on Thursday, June 11th. Investors of record on Thursday, May 21st will be paid a $0.91 dividend. The ex-dividend date of this dividend is Thursday, May 21st. This represents a $3.64 annualized dividend and a dividend yield of 0.9%. Microsoft's payout ratio is currently 22.76%.

Insider Buying and Selling at Microsoft

In other Microsoft news, Director John W. Stanton acquired 5,000 shares of Microsoft stock in a transaction that occurred on Wednesday, February 18th. The shares were bought at an average price of $397.35 per share, with a total value of $1,986,750.00. Following the completion of the purchase, the director directly owned 83,905 shares in the company, valued at $33,339,651.75. This trade represents a 6.34% increase in their position. The acquisition was disclosed in a document filed with the SEC, which is available at the SEC website. Also, EVP Kathleen T. Hogan sold 12,321 shares of the business'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 completion of the sale, the executive vice president directly owned 137,933 shares in the company, valued at approximately $56,486,322.16. This represents a 8.20% decrease in their position. The SEC filing for this sale provides additional information. Insiders own 0.03% of the company's stock.

Institutional Trading of Microsoft

A number of institutional investors have recently bought and sold shares of the company. Vanguard Group Inc. boosted its position in Microsoft by 2.3% during the fourth quarter. Vanguard Group Inc. now owns 717,942,580 shares of the software giant's stock valued at $347,211,391,000 after acquiring an additional 15,955,898 shares during the last quarter. State Street Corp boosted its position in Microsoft by 2.1% during the fourth quarter. State Street Corp now owns 306,150,608 shares of the software giant's stock valued at $148,060,557,000 after acquiring an additional 6,388,930 shares during the last quarter. Geode Capital Management LLC boosted its position in Microsoft by 1.1% during the fourth quarter. Geode Capital Management LLC now owns 182,618,400 shares of the software giant's stock valued at $88,056,019,000 after acquiring an additional 1,911,142 shares during the last quarter. Morgan Stanley boosted its position in Microsoft by 0.8% during the fourth quarter. Morgan Stanley now owns 121,220,561 shares of the software giant's stock valued at $58,624,690,000 after acquiring an additional 980,439 shares during the last quarter. Finally, Norges Bank bought a new stake in Microsoft during the fourth quarter valued at $50,664,631,000. Institutional investors own 71.13% of the company's stock.

Microsoft Company Profile

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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