Microsoft (NASDAQ:MSFT) Trading Down 2.5% Following Insider Selling

Key Points

• Microsoft's stock fell by 2.5% after CEO Satya Nadella sold 149,205 shares, reducing his holdings by 15.87% and prompting concerns among investors.
• Despite the decline, several analysts upgraded Microsoft’s stock rating, with price targets increased to as high as $675.00, reflecting confidence in the company's growth prospects.
• The company reported strong quarterly earnings, with $76.44 billion in revenue, surpassing estimates and exhibiting a year-over-year growth of 18.1%.

Microsoft Corporation (NASDAQ:MSFT - Get Free Report) was down 2.5% on Friday following insider selling activity. The company traded as low as $498.07 and last traded at $495.51. Approximately 8,527,783 shares were traded during trading, a decline of 61% from the average daily volume of 22,107,371 shares. The stock had previously closed at $507.97.

Specifically, CEO Satya Nadella sold 149,205 shares of the firm's stock in a transaction dated Wednesday, September 3rd. The stock was sold at an average price of $504.78, for a total transaction of $75,315,699.90. Following the transaction, the chief executive officer directly owned 790,852 shares of the company's stock, valued at approximately $399,206,272.56. This trade represents a 15.87% decrease in their position. The sale was disclosed in a filing with the SEC, which is accessible through this link.

Wall Street Analysts Forecast Growth

A number of research firms have weighed in on MSFT. KeyCorp raised Microsoft from a "sector weight" rating to an "overweight" rating and set a $630.00 target price on the stock in a report on Thursday, July 31st. Royal Bank Of Canada raised their price objective on Microsoft from $525.00 to $640.00 and gave the stock an "outperform" rating in a research note on Thursday, July 31st. Truist Financial upped their price target on shares of Microsoft from $650.00 to $675.00 and gave the stock a "buy" rating in a research report on Monday, August 18th. Citigroup upped their price target on Microsoft from $605.00 to $613.00 and gave the company a "buy" rating in a research note on Tuesday, July 22nd. Finally, DA Davidson increased their price target on Microsoft from $600.00 to $650.00 and gave the company a "buy" rating in a research report on Thursday, July 31st. One research analyst has rated the stock with a Strong Buy rating, twenty-nine have issued a Buy rating and two have assigned a Hold rating to the stock. According to data from MarketBeat.com, the stock has an average rating of "Moderate Buy" and an average target price of $612.54.

Microsoft Trading Down 2.1%

The business's 50-day moving average price is $509.95 and its 200 day moving average price is $450.01. 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 market capitalization of $3.70 trillion, a price-to-earnings ratio of 36.42, a PEG ratio of 2.21 and a beta of 1.04.

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

Microsoft Announces Dividend

The company 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. This represents a $3.32 annualized dividend and a dividend yield of 0.7%. The ex-dividend date of this dividend is Thursday, August 21st. Microsoft's dividend payout ratio (DPR) is presently 24.34%.

Institutional Trading of Microsoft

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in the company. Newton One Investments LLC raised its stake in shares of Microsoft by 66.7% during the 1st quarter. Newton One Investments LLC now owns 75 shares of the software giant's stock worth $28,000 after purchasing an additional 30 shares in the last quarter. Longfellow Investment Management Co. LLC raised its holdings in 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 acquiring an additional 20 shares in the last quarter. Ball & Co Wealth Management Inc. bought a new stake in shares of Microsoft during the 4th quarter worth $31,000. Bulwark Capital Corp bought a new stake in shares of Microsoft during the 2nd quarter worth $32,000. Finally, Westend Capital Management LLC increased its holdings in Microsoft by 386.7% in the 2nd quarter. Westend Capital Management LLC now owns 73 shares of the software giant's stock worth $36,000 after purchasing an additional 58 shares in the last quarter. 71.13% of the stock is currently owned by institutional investors and hedge funds.

About Microsoft

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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