Microsoft (NASDAQ:MSFT) Shares Up 1.1% – Time to Buy?

Microsoft Corporation (NASDAQ:MSFT)’s stock price shot up 1.1% during mid-day trading on Thursday. The company traded as high as $541.13 and last traded at $539.44. Approximately 22,495,467 shares were traded during trading, a decline of 34% from the average daily volume of 34,097,559 shares. The stock had previously closed at $533.69.

More Microsoft News

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Analysts expect Microsoft to remain the only major hyperscaler with positive free cash flow over the next year despite heavy AI investment. This reinforces confidence that the company can fund data-center expansion without substantial external financing. Microsoft Free Cash Flow Expected to Remain Positive
• Positive Sentiment: Microsoft signed a 20-year agreement with NiSource for approximately 1,100 megawatts of power for an Indiana data-center campus beginning in 2028. Securing electricity supports future Azure capacity as grid constraints become a bottleneck for AI expansion. Microsoft Signs Power Deal With NiSource
• Positive Sentiment: Microsoft’s custom Maia AI chips and reports that a new model achieved comparable or better performance than OpenAI’s system using a fraction of the computing power could eventually reduce reliance on expensive third-party GPUs and improve AI economics. Microsoft Wants to Make AI Cheaper
• Neutral Sentiment: Investors are focused on Azure growth, Copilot adoption, AI monetization and capital expenditures ahead of earnings. Strong demand could support the shares, but the market wants evidence that revenue growth is translating into sustainable margins.
• Negative Sentiment: The U.K. Competition and Markets Authority is investigating Microsoft’s grip on business software and says Microsoft and Amazon Web Services may need to do more to address cloud-service barriers. Potential remedies could increase compliance costs or weaken customer-lock-in advantages. UK Regulator Targets Microsoft’s Business Software Grip
• Negative Sentiment: Questions remain over whether custom chips will deliver meaningful savings: AI infrastructure, power and data-center commitments are rising rapidly, while Microsoft is reportedly seeking substantial cost reductions in Azure. That creates concern about near-term free-cash-flow and margin pressure.

Analyst Ratings Changes

A number of research analysts recently weighed in on the stock. Truist Financial restated a “buy” rating and issued a $575.00 price objective on shares of Microsoft in a report on Wednesday, July 22nd. KeyCorp reiterated an “overweight” rating on shares of Microsoft in a report on Thursday, September 3rd. Oppenheimer raised their price target on shares of Microsoft from $515.00 to $570.00 and gave the company an “outperform” rating in a research report on Tuesday, September 22nd. Evercore raised shares of Microsoft from an “underperform” rating to an “outperform” rating in a research report on Monday, October 5th. Finally, Benchmark restated a “buy” rating on shares of Microsoft in a research note on Friday, July 24th. Forty-two analysts have rated the stock with a Buy rating, four have assigned a Hold rating and two have issued a Sell rating to the company’s stock. According to MarketBeat.com, the company presently has an average rating of “Moderate Buy” and a consensus price target of $589.71.

Microsoft Stock Performance

The stock has a 50-day moving average price of $505.53 and a 200 day moving average price of $440.59. The company has a quick ratio of 1.22, a current ratio of 1.23 and a debt-to-equity ratio of 0.07. The firm has a market capitalization of $3.93 trillion, a price-to-earnings ratio of 29.46, a P/E/G ratio of 1.73 and a beta of 1.10.

Microsoft (NASDAQ:MSFT) last issued its earnings results on Wednesday, July 29th. The software giant reported $4.74 earnings per share for the quarter, beating the consensus estimate of $4.24 by $0.50. Microsoft had a net margin of 40.31% and a return on equity of 31.98%. The firm had revenue of $90.01 billion for the quarter, compared to analysts’ expectations of $87.62 billion. During the same quarter last year, the company earned $3.65 earnings per share. The firm’s revenue was up 17.7% compared to the same quarter last year. On average, analysts forecast that Microsoft Corporation will post 19.65 EPS for the current year.

Microsoft Increases Dividend

The company also recently disclosed a quarterly dividend, which will be paid on Thursday, December 10th. Shareholders of record on Thursday, November 19th will be given a $0.98 dividend. The ex-dividend date of this dividend is Thursday, November 19th. This represents a $3.92 dividend on an annualized basis and a dividend yield of 0.7%. This is a boost from Microsoft’s previous quarterly dividend of $0.91. Microsoft’s payout ratio is currently 20.27%.

Insider Activity

In other news, EVP Amy Hood sold 7,305 shares of the firm’s stock in a transaction on Tuesday, October 13th. The shares were sold at an average price of $545.42, for a total value of $3,984,293.10. Following the sale, the executive vice president directly owned 555,396 shares in the company, valued at approximately $302,924,086.32. This trade represents a 1.30% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Judson Althoff sold 10,000 shares of Microsoft stock in a transaction on Wednesday, August 5th. The stock was sold at an average price of $487.89, for a total transaction of $4,878,900.00. Following the sale, the chief executive officer directly owned 100,447 shares of the company’s stock, valued at approximately $49,007,086.83. This trade represents a 9.05% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold a total of 150,314 shares of company stock valued at $75,404,992 over the last quarter. Company insiders own 0.03% of the company’s stock.

Institutional Inflows and Outflows

A number of hedge funds have recently made changes to their positions in MSFT. State Street Corp grew its position in shares of Microsoft by 2.9% in the 2nd quarter. State Street Corp now owns 315,653,206 shares of the software giant’s stock valued at $117,744,959,000 after buying an additional 8,944,917 shares during the last quarter. Auto Owners Insurance Co lifted its position in Microsoft by 56,160.8% in the fourth quarter. Auto Owners Insurance Co now owns 60,116,384 shares of the software giant’s stock valued at $29,073,486,000 after acquiring an additional 60,009,531 shares during the last quarter. Bank of America Corp DE acquired a new position in Microsoft in the second quarter valued at $27,338,370,000. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC boosted its stake in Microsoft by 0.9% in the second quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 64,375,360 shares of the software giant’s stock valued at $24,013,297,000 after acquiring an additional 543,172 shares in the last quarter. Finally, Legal & General Group Plc purchased a new position in shares of Microsoft during the second quarter worth about $18,306,443,000. Hedge funds and other institutional investors own 71.13% of the company’s stock.

Microsoft Company Profile

Microsoft Corporation is a global technology company that develops software, cloud services, devices, gaming products and business solutions. Founded in 1975 by Bill Gates and Paul Allen, the company is best known for the Windows operating system and Microsoft Office productivity software. Microsoft is headquartered in Redmond, Washington, and serves consumers, businesses, governments and educational institutions worldwide.

Microsoft’s productivity and business offerings include Microsoft 365 applications such as Word, Excel, PowerPoint and Outlook, along with collaboration tools including Teams.