Microsoft (NASDAQ:MSFT) Stock Jumps 2.7% – Time to Buy?

Microsoft Corporation (NASDAQ:MSFT) was up 2.7% during mid-day trading on Tuesday. The stock traded as high as $523.44 and last traded at $520.99. 19,806,943 shares traded hands during trading, a decline of 41% from the average session volume of 33,412,012 shares. The stock had previously closed at $507.12.

Microsoft News Roundup

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Azure growth is the key near-term catalyst. A report cited 48% Azure growth as helping lift Microsoft shares amid an AI-sector rebound, reinforcing optimism that the company is converting AI demand into cloud revenue. What’s Going on with Microsoft Stock on Tuesday?
• Positive Sentiment: Investors see Microsoft as well positioned to monetize AI. Recent commentary points to its cloud business, cash generation and ability to fund infrastructure as advantages in the hyperscaler AI race. Microsoft’s Copilot also gained a practical selling point with support for AI use on PCs with 8GB of memory, potentially broadening adoption. Why Microsoft Is Winning the AI Spending Race Among Hyperscalers AI on an 8GB PC? Yes, Says Microsoft
• Positive Sentiment: Xbox’s reveal of the title of a new Elder Scrolls game added a smaller, consumer-facing positive headline, though its likely financial impact is limited. Microsoft Stock Rises After The Elder Scrolls VI: Sentinel Reveal
• Neutral Sentiment: Coverage highlights differing investor views on AI investment: Microsoft’s spending is substantial, but some analysis says its relative funding discipline and strong cash flow compare favorably with rivals. That could support confidence in returns while leaving execution and capital efficiency under scrutiny. Why Microsoft Was Rewarded for Spending Less on AI
• Negative Sentiment: Heavy AI infrastructure costs remain a risk. Microsoft reportedly spent $45.2 billion on capital expenditures in one quarter, much of it for AI. Investors may question whether that outlay will generate adequate returns, particularly as reports also describe buyout offers to about 60,000 employees—raising uncertainty about workforce changes and costs. 5 questions to ask if your boss offers you a buyout, as Microsoft did with 60,000 employees

Analyst Ratings Changes

MSFT has been the topic of several research analyst reports. BNP Paribas Exane lowered shares of Microsoft from a “strong-buy” rating to a “hold” rating in a research report on Monday, October 5th. KeyCorp set a $625.00 price target on shares of Microsoft in a report on Thursday, October 29th. Weiss Ratings upgraded shares of Microsoft from a “hold (c+)” rating to a “buy (b-)” rating in a research note on Thursday, October 8th. Wolfe Research raised shares of Microsoft from a “hold” rating to a “strong-buy” rating in a report on Thursday, October 29th. Finally, Evercore raised shares of Microsoft from an “underperform” rating to an “outperform” rating in a report on Monday, October 5th. One equities research analyst has rated the stock with a Strong Buy rating, forty-five have assigned a Buy rating and four have issued a Hold rating to the company. According to MarketBeat.com, Microsoft currently has an average rating of “Moderate Buy” and a consensus target price of $609.54.

Microsoft Price Performance

The company has a market capitalization of $3.87 trillion, a price-to-earnings ratio of 27.19, a P/E/G ratio of 1.67 and a beta of 1.10. The company has a fifty day simple moving average of $513.39 and a two-hundred day simple moving average of $438.62. The company has a debt-to-equity ratio of 0.07, a quick ratio of 1.22 and a current ratio of 1.23.

Microsoft (NASDAQ:MSFT) last released its earnings results on Wednesday, October 28th. The software giant reported $4.89 earnings per share for the quarter, topping the consensus estimate of $4.72 by $0.17. The firm had revenue of $92.28 billion for the quarter, compared to the consensus estimate of $90.62 billion. Microsoft had a return on equity of 32.31% and a net margin of 41.17%. The firm’s revenue for the quarter was up 18.8% compared to the same quarter last year. During the same period in the prior year, the business posted $4.13 earnings per share. As a group, research analysts anticipate that Microsoft Corporation will post 19.79 earnings per share for the current year.

Microsoft Increases Dividend

The firm also recently announced a quarterly dividend, which will be paid on Thursday, December 10th. Stockholders of record on Thursday, November 19th will be paid 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 0.8%. This is a boost from Microsoft’s previous quarterly dividend of $0.91. Microsoft’s payout ratio is 20.46%.

Insider Buying and Selling at Microsoft

In other news, CEO Judson Althoff sold 10,000 shares of the company’s stock in a transaction dated Wednesday, August 5th. The stock was sold at an average price of $487.89, for a total value of $4,878,900.00. Following the completion of the sale, the chief executive officer owned 100,447 shares of the company’s stock, valued at $49,007,086.83. This represents a 9.05% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, EVP Amy Hood sold 41,674 shares of the business’s stock in a transaction that occurred on Monday, September 14th. The stock was sold at an average price of $498.27, for a total value of $20,764,903.98. Following the transaction, the executive vice president directly owned 533,624 shares in the company, valued at $265,888,830.48. This trade represents a 7.24% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Insiders have sold 145,504 shares of company stock valued at $73,016,924 over the last three months. 0.03% of the stock is owned by company insiders.

Institutional Investors Weigh In On Microsoft

Several hedge funds and other institutional investors have recently modified their holdings of MSFT. Leelyn Smith LLC raised its stake in Microsoft by 3.5% in the third quarter. Leelyn Smith LLC now owns 33,952 shares of the software giant’s stock worth $17,414,000 after buying an additional 1,153 shares in the last quarter. Sierra Ocean LLC boosted its position in Microsoft by 5.9% during the 3rd quarter. Sierra Ocean LLC now owns 4,793 shares of the software giant’s stock valued at $2,458,000 after acquiring an additional 265 shares in the last quarter. Verus Capital Partners LLC boosted its position in Microsoft by 7.3% during the 3rd quarter. Verus Capital Partners LLC now owns 83,574 shares of the software giant’s stock valued at $42,865,000 after acquiring an additional 5,670 shares in the last quarter. Pegasus Asset Management Inc. increased its holdings in shares of Microsoft by 1.5% in the 3rd quarter. Pegasus Asset Management Inc. now owns 37,098 shares of the software giant’s stock valued at $19,028,000 after acquiring an additional 553 shares during the period. Finally, Parallel Advisors LLC raised its position in shares of Microsoft by 0.7% in the 3rd quarter. Parallel Advisors LLC now owns 307,428 shares of the software giant’s stock worth $157,680,000 after acquiring an additional 2,113 shares in the last quarter. Institutional investors own 71.13% of the company’s stock.

Microsoft Company Profile

Microsoft Corporation (NASDAQ:MSFT) is a global technology company that develops software, cloud services, devices and digital platforms. Its products and services are used by consumers, businesses, governments and educational institutions worldwide.

The company’s principal offerings include the Windows operating system; Microsoft 365 productivity applications such as Word, Excel, Teams and Outlook; Azure cloud computing and infrastructure services; Dynamics business applications; and enterprise security solutions.