Royal Bank Of Canada Reiterates "Buy" Rating for Microsoft (NASDAQ:MSFT)

Key Points

• Royal Bank Of Canada has reaffirmed its "buy" rating for Microsoft, setting a target price of $640.00, indicating a potential upside of 23.79% from current levels.
• Microsoft reported impressive quarterly earnings with an EPS of $3.65, surpassing estimates and showcasing a 36.15% net margin.
• Institutional ownership of Microsoft stands at 71.13%, with significant recent contributions from major investors like Vanguard Group and State Street Corp.

Microsoft (NASDAQ:MSFT - Get Free Report)'s stock had its "buy" rating reaffirmed by equities research analysts at Royal Bank Of Canada in a research note issued on Friday,MarketScreener Latest Ratings reports. They currently have a $640.00 target price on the software giant's stock. Royal Bank Of Canada's price objective would indicate a potential upside of 23.79% from the company's current price.

Several other equities research analysts also recently commented on the stock. Sanford C. Bernstein boosted their target price on shares of Microsoft from $540.00 to $637.00 and gave the company an "outperform" rating in a research note on Thursday, July 31st. Wall Street Zen cut Microsoft from a "buy" rating to a "hold" rating in a research note on Saturday, September 20th. Piper Sandler upped their price target on Microsoft from $600.00 to $650.00 and gave the stock an "overweight" rating in a research report on Thursday, July 31st. Truist Financial raised their price target on Microsoft from $650.00 to $675.00 and gave the company a "buy" rating in a report on Monday, August 18th. Finally, Raymond James Financial lifted their target price on Microsoft from $490.00 to $570.00 and gave the stock an "outperform" rating in a report on Monday, July 28th. One investment analyst has rated the stock with a Strong Buy rating, thirty have issued a Buy rating and two have assigned a Hold rating to the company. According to MarketBeat, Microsoft presently has an average rating of "Moderate Buy" and a consensus target price of $617.63.

Microsoft Stock Up 0.2%

MSFT traded up $1.27 during midday trading on Friday, hitting $517.01. 10,905,080 shares of the company's stock traded hands, compared to its average volume of 22,001,438. Microsoft has a one year low of $344.79 and a one year high of $555.45. The company has a market cap of $3.84 trillion, a PE ratio of 37.90, a price-to-earnings-growth ratio of 2.26 and a beta of 1.03. 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 stock's fifty day simple moving average is $512.75 and its 200-day simple moving average is $465.70.

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

Insider Buying and Selling

In other Microsoft news, EVP Takeshi Numoto sold 4,850 shares of the business'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 transaction, the executive vice president directly owned 39,111 shares of the company's stock, valued at approximately $20,624,012.52. The trade was a 11.03% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, CEO Satya Nadella sold 149,205 shares of the business's stock in a transaction that occurred on Wednesday, September 3rd. The shares were sold at an average price of $504.78, for a total value of $75,315,699.90. Following the completion of the transaction, the chief executive officer directly owned 790,852 shares in the company, valued at approximately $399,206,272.56. This trade represents a 15.87% decrease in their ownership of the stock. The disclosure for this sale can be found here. 0.03% of the stock is owned by insiders.

Institutional Inflows and Outflows

A number of institutional investors have recently bought and sold shares of the business. Vanguard Group Inc. lifted its position in shares of Microsoft by 2.0% during the 2nd quarter. Vanguard Group Inc. now owns 705,077,786 shares of the software giant's stock valued at $350,712,742,000 after buying an additional 13,691,572 shares during the last quarter. State Street Corp lifted its holdings in Microsoft by 1.1% during the 2nd quarter. State Street Corp now owns 299,196,519 shares of the software giant's stock worth $148,823,341,000 after purchasing an additional 3,166,275 shares in the last quarter. Geode Capital Management LLC lifted its holdings in Microsoft by 2.0% during the 2nd quarter. Geode Capital Management LLC now owns 179,001,751 shares of the software giant's stock worth $88,714,256,000 after purchasing an additional 3,532,054 shares in the last quarter. Norges Bank purchased a new stake in Microsoft during the 2nd quarter worth about $50,493,678,000. Finally, Kingstone Capital Partners Texas LLC lifted its holdings in Microsoft by 564,387.1% during the 2nd quarter. Kingstone Capital Partners Texas LLC now owns 90,549,369 shares of the software giant's stock worth $45,040,162,000 after purchasing an additional 90,533,328 shares in the last quarter. Institutional investors own 71.13% of the company's stock.

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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