Evercore ISI Issues Pessimistic Forecast for Microsoft (NASDAQ:MSFT) Stock Price

Microsoft (NASDAQ:MSFT) had its target price reduced by equities researchers at Evercore ISI from $640.00 to $580.00 in a research report issued on Thursday, MarketBeat Ratings reports. The firm currently has an “outperform” rating on the software giant’s stock. Evercore ISI’s target price indicates a potential upside of 34.79% from the company’s current price.

A number of other research analysts also recently commented on MSFT. DA Davidson reaffirmed a “buy” rating and issued a $650.00 target price on shares of Microsoft in a research report on Thursday, December 4th. Cantor Fitzgerald decreased their price objective on shares of Microsoft from $639.00 to $590.00 in a research note on Thursday, January 22nd. Guggenheim reiterated a “buy” rating and set a $586.00 target price on shares of Microsoft in a research report on Thursday, January 22nd. Jefferies Financial Group reissued a “buy” rating on shares of Microsoft in a research report on Thursday, January 22nd. Finally, Weiss Ratings reaffirmed a “buy (b)” rating on shares of Microsoft in a research report on Thursday, January 22nd. One investment analyst has rated the stock with a Strong Buy rating, forty have given a Buy rating and three have given a Hold rating to the company. Based on data from MarketBeat, the stock has a consensus rating of “Moderate Buy” and a consensus target price of $597.73.

Microsoft Trading Down 0.7%

MSFT opened at $430.29 on Thursday. The company has a debt-to-equity ratio of 0.09, a quick ratio of 1.39 and a current ratio of 1.39. Microsoft has a one year low of $344.79 and a one year high of $555.45. The company has a market cap of $3.20 trillion, a P/E ratio of 26.91, a PEG ratio of 1.74 and a beta of 1.07. The business’s 50-day simple moving average is $475.83 and its 200-day simple moving average is $499.71.

Microsoft (NASDAQ:MSFT) last announced its quarterly earnings results on Wednesday, January 28th. The software giant reported $4.14 earnings per share (EPS) for the quarter, beating analysts’ consensus estimates of $3.86 by $0.28. Microsoft had a return on equity of 32.34% and a net margin of 39.04%.The firm had revenue of $81.27 billion during the quarter, compared to the consensus estimate of $80.28 billion. During the same period in the prior year, the company posted $3.23 earnings per share. The firm’s quarterly revenue was up 16.7% compared to the same quarter last year. As a group, equities research analysts expect that Microsoft will post 13.08 EPS for the current fiscal year.

Insider Buying and Selling

In other news, insider Bradford L. Smith sold 38,500 shares of the firm’s stock in a transaction on Monday, November 3rd. The shares were sold at an average price of $518.64, for a total value of $19,967,640.00. Following the completion of the sale, the insider owned 461,597 shares in the company, valued at approximately $239,402,668.08. This trade represents a 7.70% decrease in their position. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Also, CEO Judson Althoff sold 12,750 shares of the business’s stock in a transaction dated Tuesday, December 2nd. The stock was sold at an average price of $491.52, for a total transaction of $6,266,880.00. Following the transaction, the chief executive officer owned 129,349 shares in the company, valued at approximately $63,577,620.48. This trade represents a 8.97% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold a total of 54,100 shares of company stock valued at $27,598,872 over the last three months. 0.03% of the stock is currently owned by company insiders.

Institutional Investors Weigh In On Microsoft

Institutional investors have recently added to or reduced their stakes in the business. Wellington Capital Management Inc. purchased a new position in shares of Microsoft in the second quarter valued at $9,941,000. Sound View Wealth Advisors Group LLC grew its stake in Microsoft by 2.6% in the 2nd 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. Bank Pictet & Cie Europe AG increased its holdings in Microsoft by 3.8% during the 2nd quarter. Bank Pictet & Cie Europe AG now owns 922,524 shares of the software giant’s stock valued at $457,119,000 after acquiring an additional 33,382 shares in the last quarter. Weaver Capital Management LLC raised its position in Microsoft by 14.0% during the third quarter. Weaver Capital Management LLC now owns 18,340 shares of the software giant’s stock worth $9,499,000 after acquiring an additional 2,247 shares during the last quarter. Finally, Gradient Investments LLC lifted its holdings in shares of Microsoft by 4.3% in 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. Hedge funds and other institutional investors own 71.13% of the company’s stock.

Key Stories Impacting Microsoft

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).