Microsoft (NASDAQ:MSFT) Lowered to “Hold” Rating by Melius Research

Melius Research downgraded shares of Microsoft (NASDAQ:MSFT) from a buy rating to a hold rating in a research note published on Monday, MarketBeat Ratings reports.

MSFT has been the subject of several other reports. Arete Research upped their target price on Microsoft from $710.00 to $730.00 in a research note on Monday, October 27th. Citigroup reduced their price objective on shares of Microsoft from $660.00 to $635.00 and set a “buy” rating for the company in a research report on Thursday, January 29th. Phillip Securities upgraded shares of Microsoft from a “moderate buy” rating to a “strong-buy” rating in a research report on Sunday, February 1st. Robert W. Baird set a $540.00 target price on shares of Microsoft and gave the stock an “outperform” rating in a research note on Thursday, January 29th. Finally, The Goldman Sachs Group decreased their price target on shares of Microsoft from $655.00 to $600.00 and set a “buy” rating on the stock in a research note on Thursday, January 29th. Two equities research analysts have rated the stock with a Strong Buy rating, thirty-nine have assigned a Buy rating and four have assigned a Hold rating to the stock. Based on data from MarketBeat, the stock presently has a consensus rating of “Moderate Buy” and a consensus target price of $591.95.

Microsoft Stock Up 3.2%

Microsoft stock opened at $414.12 on Monday. The company has a debt-to-equity ratio of 0.09, a quick ratio of 1.38 and a current ratio of 1.39. The business’s 50-day simple moving average is $466.97 and its two-hundred day simple moving average is $495.42. The company has a market cap of $3.08 trillion, a PE ratio of 25.90, a PEG ratio of 1.57 and a beta of 1.08. Microsoft has a fifty-two week low of $344.79 and a fifty-two week high of $555.45.

Microsoft (NASDAQ:MSFT) last announced its quarterly 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. Microsoft had a return on equity of 32.34% and a net margin of 39.04%.The company had revenue of $81.27 billion for the quarter, compared to the consensus estimate of $80.28 billion. During the same period last year, the firm earned $3.23 EPS. The firm’s revenue for the quarter was up 16.7% compared to the same quarter last year. Equities analysts anticipate that Microsoft will post 13.08 EPS for the current year.

Microsoft Dividend Announcement

The business also recently disclosed a quarterly dividend, which will be paid on Thursday, March 12th. Investors of record on Thursday, February 19th will be issued a $0.91 dividend. This represents a $3.64 annualized dividend and a yield of 0.9%. The ex-dividend date is Thursday, February 19th. Microsoft’s payout ratio is 22.76%.

Insider Transactions at Microsoft

In related news, EVP Takeshi Numoto sold 2,850 shares of the stock in a transaction that occurred 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 completion of the transaction, the executive vice president owned 55,782 shares of the company’s stock, valued at approximately $26,703,959.04. This trade represents a 4.86% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is accessible through this hyperlink. Also, CEO Judson Althoff sold 12,750 shares of Microsoft stock in a transaction that occurred 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 completion of the sale, the chief executive officer owned 129,349 shares of the company’s stock, valued at $63,577,620.48. This trade represents a 8.97% decrease in their position. The disclosure for this sale is available in the SEC filing. Corporate insiders own 0.03% of the company’s stock.

Institutional Investors Weigh In On Microsoft

Institutional investors have recently modified their holdings of the company. IRON Financial LLC raised its position in shares of Microsoft by 23.2% during the 3rd quarter. IRON Financial LLC now owns 6,510 shares of the software giant’s stock valued at $3,372,000 after buying an additional 1,225 shares in the last quarter. Wellington Capital Management Inc. purchased a new position in Microsoft in the second quarter worth $9,941,000. Sound View Wealth Advisors Group LLC increased its stake in Microsoft by 2.6% in the second quarter. Sound View Wealth Advisors Group LLC now owns 94,120 shares of the software giant’s stock valued at $46,816,000 after acquiring an additional 2,373 shares during the last quarter. Weaver Capital Management LLC increased its stake in Microsoft by 14.0% in the third quarter. Weaver Capital Management LLC now owns 18,340 shares of the software giant’s stock valued at $9,499,000 after acquiring an additional 2,247 shares during the last quarter. Finally, Gradient Investments LLC raised its position in Microsoft by 4.3% during the third quarter. Gradient Investments LLC now owns 285,163 shares of the software giant’s stock valued at $147,700,000 after purchasing an additional 11,770 shares in the last quarter. 71.13% of the stock is owned by institutional investors and hedge funds.

Trending Headlines about Microsoft

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Bullish analyst commentary and broader tech-led market lift helped push MSFT higher after last week’s sell-off; the coverage framed the pullback as a buying opportunity. Why Microsoft Stock Topped the Market Today
• Positive Sentiment: Microsoft disclosed how many paying Copilot customers it has — a concrete monetization datapoint that reassures investors about AI product revenue traction. Microsoft Finally Revealed How Many Paying Copilot Customers It Has. The Answer Was Shocking for More Reasons Than One.
• Positive Sentiment: Reports attribute part of MSFT’s gains to a key new hire meant to shore up AI efforts and execution — a governance/operational positive that calms investor nerves about execution risk. Microsoft Stock (NASDAQ:MSFT) Gains Thanks in Part to New Hire
• Positive Sentiment: Momentum at OpenAI (where Microsoft is a major backer) shows ChatGPT growth accelerating vs. Google — supportive for Microsoft’s AI strategy and Azure demand. OpenAI Intensifies Race with Google as ChatGPT Returns to Higher Growth
• Neutral Sentiment: Xbox-related reports (next Xbox reportedly a gaming PC) provided a modest product narrative boost but are unlikely to move near-term earnings materially. Microsoft Stock (MSFT) Rises Alongside Reports the Next Xbox Will Be a Gaming PC
• Neutral Sentiment: Analysis arguing AI spending looks large on paper but is manageable helped calm some fears — frames capex as an investment with long-term payback rather than an immediate cash drain. Microsoft’s AI Spend Looks Scary, Until You Run The Numbers
• Negative Sentiment: Melius Research downgraded MSFT from Buy to Hold and cut its price target, citing concerns about AI capex and growth—this is a direct bearish analyst action pressuring sentiment. Here’s Why Melius Moved to the Sidelines on Microsoft Stock (MSFT)
• Negative Sentiment: Earlier downgrades (e.g., Stifel) and commentary that MSFT’s valuation now trades below legacy peers like IBM highlight investor worries about heavy AI CapEx and near-term margin pressure. Microsoft’s stock is now cheaper than IBM’s. What that says about the AI trade.

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).