Microsoft (NASDAQ:MSFT) Trading 5.4% Higher – Should You Buy?

Microsoft Corporation (NASDAQ:MSFT) shares traded up 5.4% on Friday . The stock traded as high as $450.33 and last traded at $450.24. 77,634,613 shares traded hands during trading, an increase of 117% from the average session volume of 35,695,727 shares. The stock had previously closed at $426.99.

Microsoft News Summary

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Microsoft and Nvidia teased “a new era of PC,” with reports pointing to new Surface hardware and a possible AI-focused chip announcement at Computex, which could refresh the Windows/PC upgrade cycle. Article Title
• Positive Sentiment: Reports that Microsoft will unveil a new coding model and other in-house AI tools at next week’s Build conference reinforce the company’s AI monetization story and support sentiment around GitHub Copilot and Azure demand. Article Title
• Positive Sentiment: Microsoft’s latest earnings backdrop remains solid, with revenue growth of 18.3% and better-than-expected EPS, helping investors justify the stock’s premium valuation.
• Positive Sentiment: Several bullish writeups and analyst commentary say MSFT still has room to run because Azure, M365 cloud, and AI revenue are expanding faster than the broader software market. Article Title
• Neutral Sentiment: Microsoft is also drawing attention from investors, fund managers, and even congressional buyers, which supports the stock’s defensive-growth reputation but does not change fundamentals on its own.
• Negative Sentiment: A TechCrunch report says Microsoft is facing backlash for threatening a security researcher over unpatched bugs and code disclosure, adding some reputational noise ahead of Build. Article Title

Wall Street Analyst Weigh In

Several equities analysts have recently weighed in on the stock. Raymond James Financial cut shares of Microsoft from a “market perform” rating to a “market perform” rating in a research note on Tuesday, May 5th. UBS Group reaffirmed a “buy” rating on shares of Microsoft in a research note on Friday, April 24th. Melius Research set a $430.00 price target on shares of Microsoft in a research note on Monday, February 9th. Benchmark reaffirmed a “buy” rating and set a $525.00 price target (up from $450.00) on shares of Microsoft in a research note on Tuesday, April 28th. Finally, DA Davidson decreased their price target on shares of Microsoft from $650.00 to $550.00 and set a “buy” rating for the company in a research note on Thursday, April 30th. Thirty-nine research analysts have rated the stock with a Buy rating and seven have assigned a Hold rating to the company. According to data from MarketBeat, Microsoft currently has a consensus rating of “Moderate Buy” and a consensus price target of $560.88.

Microsoft Stock Up 5.4%

The company has a debt-to-equity ratio of 0.08, a current ratio of 1.28 and a quick ratio of 1.27. The firm’s 50 day moving average is $402.09 and its two-hundred day moving average is $434.62. The firm has a market capitalization of $3.34 trillion, a P/E ratio of 26.80, a PEG ratio of 1.62 and a beta of 1.10.

Microsoft (NASDAQ:MSFT) last released its earnings results on Wednesday, April 29th. The software giant reported $4.27 earnings per share 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 analysts’ expectations of $81.44 billion. During the same period last year, the business earned $3.46 earnings per share. The firm’s revenue was up 18.3% on a year-over-year basis. Research analysts predict that Microsoft Corporation will post 16.76 EPS for the current year.

Microsoft Dividend Announcement

The business also recently disclosed a quarterly dividend, which will be paid on Thursday, June 11th. Shareholders of record on Thursday, May 21st will be given a dividend of $0.91 per share. This represents a $3.64 dividend on an annualized basis and a yield of 0.8%. The ex-dividend date of this dividend is Thursday, May 21st. Microsoft’s payout ratio is 21.67%.

Insiders Place Their Bets

In other Microsoft news, EVP Amy Coleman sold 1,262 shares of Microsoft stock in a transaction on Thursday, May 14th. The shares were sold at an average price of $411.34, for a total transaction of $519,111.08. Following the completion of the transaction, the executive vice president directly owned 46,003 shares of the company’s stock, valued at $18,922,874.02. The trade was a 2.67% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which is available through this hyperlink. Also, EVP Kathleen T. Hogan sold 12,321 shares of Microsoft stock in a transaction on Friday, March 6th. The stock was sold at an average price of $409.52, for a total transaction of $5,045,695.92. Following the transaction, the executive vice president directly owned 137,933 shares of the company’s stock, valued at approximately $56,486,322.16. This trade represents a 8.20% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders own 0.03% of the company’s stock.

Hedge Funds Weigh In On Microsoft

A number of hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. BLVD Private Wealth LLC lifted its holdings in shares of Microsoft by 0.6% during the third quarter. BLVD Private Wealth LLC now owns 3,169 shares of the software giant’s stock worth $1,641,000 after buying an additional 19 shares in the last quarter. Magnolia Capital Management Ltd. lifted its holdings in shares of Microsoft by 0.3% during the third quarter. Magnolia Capital Management Ltd. now owns 6,509 shares of the software giant’s stock worth $3,371,000 after buying an additional 20 shares in the last quarter. ARK & TLK Investments LLC lifted its holdings in shares of Microsoft by 1.0% during the third quarter. ARK & TLK Investments LLC now owns 1,935 shares of the software giant’s stock worth $1,002,000 after buying an additional 20 shares in the last quarter. Rochester Wealth Strategies LLC lifted its holdings in shares of Microsoft by 2.9% during the third quarter. Rochester Wealth Strategies LLC now owns 700 shares of the software giant’s stock worth $363,000 after buying an additional 20 shares in the last quarter. Finally, Longfellow Investment Management Co. LLC lifted its holdings 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 buying an additional 20 shares in the last quarter. 71.13% of the stock is 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).