Microsoft (NASDAQ:MSFT) Cut to Neutral at DA Davidson

DA Davidson lowered shares of Microsoft (NASDAQ:MSFT) from a buy rating to a neutral rating in a report issued on Monday morning, Marketbeat Ratings reports. They currently have $475.00 target price on the software giant’s stock. DA Davidson also issued estimates for Microsoft’s Q1 2025 earnings at $2.96 EPS.

Other equities analysts have also issued research reports about the stock. Bank of America increased their price target on shares of Microsoft from $480.00 to $510.00 and gave the stock a buy rating in a report on Wednesday, July 17th. TD Cowen raised their price target on Microsoft from $470.00 to $495.00 and gave the company a buy rating in a research report on Thursday, July 18th. Oppenheimer upped their price objective on Microsoft from $450.00 to $500.00 and gave the stock an outperform rating in a report on Friday, June 7th. Wedbush reissued an outperform rating and set a $550.00 price objective on shares of Microsoft in a report on Wednesday, July 31st. Finally, UBS Group cut their target price on Microsoft from $520.00 to $510.00 and set a buy rating for the company in a research note on Wednesday, July 31st. Two equities research analysts have rated the stock with a hold rating and thirty-one have assigned a buy rating to the company. According to data from MarketBeat, Microsoft has an average rating of Moderate Buy and a consensus price target of $493.94.

Microsoft Price Performance

NASDAQ:MSFT opened at $431.31 on Monday. Microsoft has a 52-week low of $309.45 and a 52-week high of $468.35. The stock has a fifty day moving average of $419.87 and a 200 day moving average of $424.72. The company has a debt-to-equity ratio of 0.16, a quick ratio of 1.27 and a current ratio of 1.27. The firm has a market capitalization of $3.21 trillion, a price-to-earnings ratio of 37.34, a P/E/G ratio of 2.30 and a beta of 0.90.

Microsoft (NASDAQ:MSFT) last issued its quarterly earnings results on Tuesday, July 30th. The software giant reported $2.95 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $2.90 by $0.05. The firm had revenue of $64.73 billion during the quarter, compared to the consensus estimate of $64.38 billion. Microsoft had a return on equity of 35.95% and a net margin of 35.96%. The company’s revenue for the quarter was up 15.2% on a year-over-year basis. During the same quarter last year, the company posted $2.69 EPS. On average, research analysts expect that Microsoft will post 13.04 EPS for the current fiscal year.

Microsoft Increases Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Thursday, December 12th. Shareholders of record on Thursday, November 21st will be given a dividend of $0.83 per share. This represents a $3.32 annualized dividend and a yield of 0.77%. This is a boost from Microsoft’s previous quarterly dividend of $0.75. The ex-dividend date is Thursday, November 21st. Microsoft’s payout ratio is presently 25.97%.

Microsoft declared that its Board of Directors has initiated a stock repurchase program on Monday, September 16th that permits the company to repurchase $60.00 billion in shares. This repurchase authorization permits the software giant to buy up to 1.9% of its shares through open market purchases. Shares repurchase programs are generally a sign that the company’s board believes its shares are undervalued.

Insider Activity

In related news, CEO Satya Nadella sold 14,398 shares of the company’s stock in a transaction on Friday, August 23rd. The stock was sold at an average price of $417.41, for a total value of $6,009,869.18. Following the sale, the chief executive officer now directly owns 786,933 shares of the company’s stock, valued at $328,473,703.53. The sale was disclosed in a legal filing with the SEC, which is available through the SEC website. In related news, insider Bradford L. Smith sold 40,000 shares of Microsoft stock in a transaction dated Monday, September 9th. The shares were sold at an average price of $402.59, for a total transaction of $16,103,600.00. Following the completion of the transaction, the insider now directly owns 544,847 shares of the company’s stock, valued at approximately $219,349,953.73. The sale was disclosed in a filing with the SEC, which is available at this hyperlink. Also, CEO Satya Nadella sold 14,398 shares of the company’s stock in a transaction dated Friday, August 23rd. The stock was sold at an average price of $417.41, for a total transaction of $6,009,869.18. Following the completion of the sale, the chief executive officer now owns 786,933 shares in the company, valued at approximately $328,473,703.53. The disclosure for this sale can be found here. Insiders sold a total of 190,629 shares of company stock worth $77,916,485 in the last quarter. 0.03% of the stock is owned by company insiders.

Institutional Trading of Microsoft

A number of hedge funds have recently made changes to their positions in MSFT. Vanguard Group Inc. boosted its stake in Microsoft by 0.5% in the 1st quarter. Vanguard Group Inc. now owns 667,987,038 shares of the software giant’s stock worth $281,035,506,000 after purchasing an additional 3,078,099 shares in the last quarter. Norges Bank bought a new position in shares of Microsoft in the fourth quarter worth approximately $35,920,047,000. Capital International Investors grew its holdings in shares of Microsoft by 1.0% during the first quarter. Capital International Investors now owns 83,571,070 shares of the software giant’s stock valued at $35,160,020,000 after buying an additional 842,884 shares during the last quarter. Ameriprise Financial Inc. increased its position in shares of Microsoft by 0.3% during the second quarter. Ameriprise Financial Inc. now owns 34,511,544 shares of the software giant’s stock valued at $15,426,767,000 after acquiring an additional 97,075 shares in the last quarter. Finally, Fisher Asset Management LLC raised its holdings in Microsoft by 1.6% in the 4th quarter. Fisher Asset Management LLC now owns 25,381,692 shares of the software giant’s stock worth $9,544,532,000 after acquiring an additional 403,409 shares during the last quarter. 71.13% of the stock is owned by institutional investors.

Microsoft Company Profile

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.