Microsoft (NASDAQ:MSFT) Shares Up 1.6% – Should You Buy?

Microsoft Corporation (NASDAQ:MSFT) shares rose 1.6% during mid-day trading on Thursday . The company traded as high as $392.20 and last traded at $390.49. 40,718,585 shares traded hands during trading, an increase of 7% from the average session volume of 38,013,617 shares. The stock had previously closed at $384.28.

More Microsoft News

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Microsoft launched a new AI deployment business, Microsoft Frontier Company, backed by $2.5 billion and staffed with about 6,000 engineers and industry experts to help enterprises select, implement, and improve AI tools. Investors are viewing this as a way to accelerate Azure and Copilot adoption while monetizing the enterprise AI buildout. Microsoft launches its own AI deployment company with $2.5 billion commitment
• Positive Sentiment: Several articles highlighted Microsoft as a top AI and growth stock, while others said the market is rotating from semiconductors back toward software. That is helping sentiment around MSFT as investors look for higher-quality AI beneficiaries with recurring enterprise revenue. Microsoft launches firm to help companies adopt AI with $2.5 billion
• Neutral Sentiment: Microsoft is also reported to be overhauling Copilot to make its AI assistant more useful and easier to justify for customers. That could improve adoption, but it also underscores that AI products must now prove their value. Microsoft’s Copilot Reset Shows AI Tools Must Now Prove Their Worth
• Neutral Sentiment: There was also a new undersea cable partnership with Lightstorm to expand India-Southeast Asia connectivity, plus a report that enterprise customers continue to adopt Microsoft’s AI and cloud services. These are strategically helpful, but not immediate catalysts. Microsoft partners with Singapore’s Lightstorm to build India-Southeast Asia undersea cable
• Negative Sentiment: Sentiment is still being held back by Microsoft’s weak recent stock performance, with articles noting its worst month in more than 25 years and renewed debate about whether the selloff is creating a buying opportunity. Microsoft Had Its Worst Month in More Than 25 Years. Should Investors Buy the Crash?
• Negative Sentiment: Microsoft is also facing class-action securities litigation over alleged misrepresentations during the class period, which adds a legal overhang and may keep some investors cautious. Bronstein, Gewirtz & Grossman LLC Urges Microsoft Corporation Investors to Act: Class Action Filed Alleging Investor Harm
• Negative Sentiment: Other reports said Microsoft may cut thousands of jobs and that investors are questioning whether its massive AI capital spending can generate enough returns. That uncertainty is weighing on the stock despite the company’s strong long-term fundamentals. Microsoft eyes another wave of layoffs that could hit 5,000 workers next week

Analysts Set New Price Targets

Several research analysts recently commented on MSFT shares. Stifel Nicolaus reduced their price target on shares of Microsoft from $415.00 to $400.00 and set a “hold” rating on the stock in a research note on Thursday, June 25th. Raymond James Financial downgraded shares of Microsoft from a “market perform” rating to a “market perform” rating in a research note on Tuesday, May 5th. Robert W. Baird reduced their target price on shares of Microsoft from $540.00 to $500.00 and set an “outperform” rating on the stock in a research report on Wednesday, April 15th. Evercore decreased their price target on shares of Microsoft from $580.00 to $510.00 and set an “outperform” rating for the company in a research note on Thursday, April 30th. Finally, Rothschild & Co Redburn lowered their price target on Microsoft from $450.00 to $400.00 and set a “neutral” rating for the company in a report on Thursday, April 23rd. Forty-one analysts have rated the stock with a Buy rating and six have assigned a Hold rating to the stock. According to data from MarketBeat, the stock presently has an average rating of “Moderate Buy” and a consensus target price of $560.86.

Microsoft Stock Performance

The company has a debt-to-equity ratio of 0.08, a quick ratio of 1.27 and a current ratio of 1.28. The company’s fifty day simple moving average is $406.14 and its 200-day simple moving average is $417.86. The company has a market capitalization of $2.90 trillion, a P/E ratio of 23.24, a PEG ratio of 1.22 and a beta of 1.13.

Microsoft (NASDAQ:MSFT) last posted its quarterly earnings results on Wednesday, April 29th. The software giant reported $4.27 EPS for the quarter, beating the consensus estimate of $4.06 by $0.21. Microsoft had a net margin of 39.34% and a return on equity of 31.94%. The business had revenue of $82.89 billion during the quarter, compared to analyst estimates of $81.44 billion. During the same quarter in the previous year, the business posted $3.46 EPS. The company’s quarterly revenue was up 18.3% compared to the same quarter last year. Research analysts predict that Microsoft Corporation will post 16.76 earnings per share for the current year.

Microsoft Dividend Announcement

The business also recently announced a quarterly dividend, which will be paid on Thursday, September 10th. Shareholders of record on Thursday, August 20th will be issued a dividend of $0.91 per share. The ex-dividend date is Thursday, August 20th. This represents a $3.64 dividend on an annualized basis and a yield of 0.9%. Microsoft’s dividend payout ratio is currently 21.67%.

Insiders Place Their Bets

In other news, CEO Judson Althoff sold 15,500 shares of the business’s stock in a transaction on Monday, June 1st. The stock was sold at an average price of $460.99, for a total value of $7,145,345.00. Following the completion of the transaction, the chief executive officer directly owned 110,477 shares of the company’s stock, valued at approximately $50,928,792.23. The trade was a 12.30% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. Also, EVP Amy Coleman sold 1,262 shares of the firm’s stock in a transaction dated Thursday, May 14th. The shares were sold at an average price of $411.34, for a total value of $519,111.08. Following the sale, the executive vice president directly owned 46,003 shares in the company, valued at approximately $18,922,874.02. The trade was a 2.67% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold a total of 23,762 shares of company stock worth $10,508,361 over the last 90 days. Company insiders own 0.03% of the company’s stock.

Hedge Funds Weigh In On Microsoft

A number of large investors have recently added to or reduced their stakes in MSFT. Longfellow Investment Management Co. LLC increased its position in shares of Microsoft by 51.3% during the second quarter. Longfellow Investment Management Co. LLC now owns 59 shares of the software giant’s stock worth $29,000 after purchasing an additional 20 shares in the last quarter. Bernzott Capital Advisors acquired a new stake in shares of Microsoft in the 4th quarter worth $34,000. Timmons Wealth Management LLC purchased a new position in Microsoft during the 4th quarter worth $36,000. Fairway Wealth LLC grew its stake in Microsoft by 287.0% during the 4th quarter. Fairway Wealth LLC now owns 89 shares of the software giant’s stock worth $43,000 after buying an additional 66 shares during the last quarter. Finally, LSV Asset Management acquired a new position in Microsoft during the 4th quarter valued at about $44,000. 71.13% of the stock is currently owned by institutional investors.

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).