Wolfe Research Issues Pessimistic Forecast for Microsoft (NASDAQ:MSFT) Stock Price

Microsoft (NASDAQ:MSFT) had its target price cut by equities research analysts at Wolfe Research from $625.00 to $530.00 in a report issued on Thursday,MarketScreener reports. The firm currently has an “outperform” rating on the software giant’s stock. Wolfe Research’s target price would indicate a potential upside of 23.17% from the company’s current price.

Other equities analysts also recently issued reports about the company. UBS Group reissued an “outperform” rating on shares of Microsoft in a research report on Thursday. Redburn Partners set a $450.00 price target on Microsoft in a research note on Wednesday, January 21st. JPMorgan Chase & Co. reduced their price objective on Microsoft from $575.00 to $550.00 and set an “overweight” rating for the company in a research note on Thursday. Robert W. Baird set a $540.00 target price on Microsoft and gave the stock an “outperform” rating in a report on Thursday. Finally, Guggenheim reiterated a “buy” rating and issued a $586.00 target price on shares of Microsoft in a research report on Thursday, January 22nd. One equities research analyst has rated the stock with a Strong Buy rating, forty have issued a Buy rating and three have given a Hold rating to the company’s stock. According to MarketBeat, the company currently has a consensus rating of “Moderate Buy” and a consensus target price of $597.73.

Microsoft Stock Performance

Shares of Microsoft stock opened at $430.29 on Thursday. The company has a 50 day moving average price of $475.83 and a 200 day moving average price of $499.71. The firm has a market capitalization of $3.20 trillion, a P/E ratio of 26.91, a PEG ratio of 1.74 and a beta of 1.07. The company has a quick ratio of 1.39, a current ratio of 1.39 and a debt-to-equity ratio of 0.09. Microsoft has a 52 week low of $344.79 and a 52 week high of $555.45.

Microsoft (NASDAQ:MSFT) last released its earnings results 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. The company had revenue of $81.27 billion for the quarter, compared to the consensus estimate of $80.28 billion. Microsoft had a net margin of 39.04% and a return on equity of 32.34%. Microsoft’s revenue was up 16.7% compared to the same quarter last year. During the same quarter in the previous year, the firm earned $3.23 EPS. Sell-side analysts expect that Microsoft will post 13.08 EPS for the current year.

Insider Activity at Microsoft

In related news, CEO Judson Althoff sold 12,750 shares of the stock in a transaction on Tuesday, December 2nd. The shares were sold at an average price of $491.52, for a total transaction of $6,266,880.00. Following the sale, the chief executive officer directly owned 129,349 shares of the company’s stock, valued at approximately $63,577,620.48. This represents a 8.97% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is available at this hyperlink. Also, EVP Takeshi Numoto sold 2,850 shares of the firm’s stock in a transaction on Thursday, December 4th. The shares were sold at an average price of $478.72, for a total transaction of $1,364,352.00. Following the sale, the executive vice president owned 55,782 shares in the company, valued at approximately $26,703,959.04. This represents a 4.86% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold a total of 54,100 shares of company stock worth $27,598,872 in the last three months. Company insiders own 0.03% of the company’s stock.

Institutional Inflows and Outflows

Hedge funds have recently modified their holdings of the stock. AlphaQuest LLC lifted its holdings in Microsoft by 5.9% in the 2nd quarter. AlphaQuest LLC now owns 342 shares of the software giant’s stock valued at $170,000 after purchasing an additional 19 shares in the last quarter. BLVD Private Wealth LLC raised its position in shares of Microsoft by 0.6% in the third quarter. BLVD Private Wealth LLC now owns 3,169 shares of the software giant’s stock valued at $1,641,000 after buying an additional 19 shares during the last quarter. Seek First Inc. lifted its stake in shares of Microsoft by 1.5% in the second quarter. Seek First Inc. now owns 1,358 shares of the software giant’s stock worth $675,000 after buying an additional 20 shares in the last quarter. Level Financial Advisors lifted its stake in shares of Microsoft by 0.8% in the second quarter. Level Financial Advisors now owns 2,680 shares of the software giant’s stock worth $1,333,000 after buying an additional 20 shares in the last quarter. Finally, Red Mountain Financial LLC boosted its position in Microsoft by 0.7% during the second quarter. Red Mountain Financial LLC now owns 2,761 shares of the software giant’s stock worth $1,373,000 after acquiring an additional 20 shares during the last quarter. Institutional investors and hedge funds own 71.13% of the company’s stock.

Microsoft News Summary

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Large commercial deals and partnerships underpin continued demand — Microsoft landed a major cloud customer agreement (Perplexity, reported as a $750M deal), which demonstrates Azure can win sizable AI workloads and supports future revenue. Perplexity signs $750 million AI cloud deal with Microsoft
• Positive Sentiment: Long-term AI opportunity remains large — analysts and commentators note that potential liquidity events (e.g., an OpenAI IPO) and continued hyperscaler AI demand could boost infrastructure spending that benefits Microsoft’s cloud and services over time. Could A $1 Trillion OpenAI IPO Save The Day For Nvidia, Microsoft?
• Positive Sentiment: Backlog/RPO growth signals demand — Microsoft’s commercial remaining performance obligations (backlog) jumped materially year-over-year, implying multi-year contracted revenue tied to AI workloads. Microsoft demand backlog doubles to $625 billion
• Neutral Sentiment: Quarterly results were solid but mixed — MSFT beat on revenue and EPS (Q2 results) yet the company issued guidance and commentary that implied a modest moderation in Azure growth vs. prior quarter; the market is parsing growth vs. the cost profile. Microsoft Q2 earnings beat on top and bottom lines
• Neutral Sentiment: Options and sentiment flows amplify moves — unusually high call-option buying and heavy volume have increased intraday volatility and may accentuate both selloffs and snapbacks. Stock Of The Day: Is This The Bottom For Microsoft?
• Negative Sentiment: Investor backlash to capex and margin risk — the core negative: investors punished MSFT because AI capex jumped (reported ~$37.5B in the quarter) while Azure growth showed signs of slowing, raising doubts about near-term returns. That drove a sharp selloff and a big market-cap contraction. Microsoft tumbled 10% in a day and isn’t recovering premarket. Here’s why
• Negative Sentiment: Analyst cuts & guidance uncertainty — several firms trimmed price targets or flagged near-term Azure/margin risks, increasing downside pressure even as many maintain buy ratings longer term. These Analysts Slash Their Forecasts On Microsoft Following Q2 Results
• Negative Sentiment: Legal/investor scrutiny follows the shock drop — law firms have opened investigations and class-action notices have surfaced, which can keep sentiment fragile near-term. Microsoft Corporation Investigated on Behalf of 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).