Microsoft (NASDAQ:MSFT) Trading Down 1.2% After Analyst Downgrade

Shares of Microsoft Corporation (NASDAQ:MSFT) traded down 1.2% during trading on Tuesday after TD Cowen lowered their price target on the stock from $655.00 to $625.00. TD Cowen currently has a buy rating on the stock. Microsoft traded as low as $449.28 and last traded at $454.52. 25,972,721 shares changed hands during mid-day trading, an increase of 4% from the average session volume of 24,977,225 shares. The stock had previously closed at $459.86.

Other research analysts have also recently issued reports about the company. BNP Paribas Exane increased their price target on Microsoft from $630.00 to $632.00 and gave the company an “outperform” rating in a research note on Monday, November 3rd. DA Davidson restated a “buy” rating and set a $650.00 price target on shares of Microsoft in a report on Thursday, December 4th. HSBC lifted their target price on shares of Microsoft from $643.00 to $648.00 in a research report on Monday, October 27th. Wells Fargo & Company decreased their price target on shares of Microsoft from $700.00 to $665.00 and set an “overweight” rating for the company in a research report on Thursday, January 8th. Finally, Guggenheim set a $675.00 price target on shares of Microsoft in a research note on Wednesday, November 19th. Three equities research analysts have rated the stock with a Strong Buy rating, thirty-six have issued a Buy rating and four have assigned a Hold rating to the company. According to MarketBeat.com, the stock presently has an average rating of “Moderate Buy” and a consensus target price of $629.46.

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 stock was sold at an average price of $518.64, for a total transaction of $19,967,640.00. Following the completion of the sale, the insider directly owned 461,597 shares of the company’s stock, valued at $239,402,668.08. This trade represents a 7.70% decrease in their position. The sale was disclosed in a document filed with the SEC, which is available through the SEC website. Also, EVP Takeshi Numoto sold 2,850 shares of the firm’s stock in a transaction on Thursday, December 4th. The stock was sold at an average price of $478.72, for a total value of $1,364,352.00. Following the completion of the sale, the executive vice president directly owned 55,782 shares of the company’s stock, valued at $26,703,959.04. This represents a 4.86% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Over the last ninety days, insiders have sold 54,100 shares of company stock worth $27,598,872. 0.03% of the stock is owned by insiders.

Key Microsoft News

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: OpenAI, backed by Microsoft, reached a major revenue milestone in 2025, reinforcing MSFT’s strategic AI exposure and potential upside from services tied to OpenAI. Microsoft-Backed OpenAI Hits $20B Revenue Target in 2025
• Positive Sentiment: Microsoft announced a partnership with Bristol Myers Squibb to deploy AI imaging for earlier lung?cancer detection — a commercial win in healthcare AI that could expand Azure and services revenue over time. Bristol Myers partners with Microsoft for AI-driven lung cancer detection
• Neutral Sentiment: Microsoft added third?party integrations (e.g., Cobalt Teams in Microsoft Marketplace), which incrementally broadens ecosystem monetization but are not material near?term revenue drivers. Cobalt Microsoft® Teams® Integration Now Available in the Microsoft Marketplace®
• Neutral Sentiment: Investors are bracing for Microsoft’s Jan. 28 quarterly report — expectations are elevated, making the stock sensitive to any execution misses or guidance nuance. Dear Microsoft Stock Fans, Mark Your Calendars for January 28
• Negative Sentiment: Reports that Azure growth and forward guidance disappointed expectations are pressuring the stock; cloud execution concerns directly affect revenue growth and multiples. Microsoft (MSFT) Traded Lower as Its Reported Azure Cloud Growth and Forward Guidance Fell Short of Expectations
• Negative Sentiment: Analysts trimmed price targets ahead of earnings (TD Cowen cut its target while keeping a Buy) and some firms revised models for heavy AI capex — these adjustments increase near?term downside risk despite long?term conviction. TD Cowen Adjusts Price Target on Microsoft to 625 from 655, Maintains Buy Rating
• Negative Sentiment: Macro and geopolitical headlines sparked a broader tech selloff today, amplifying pressure on large-cap growth names including MSFT. America’s Biggest Tech Stocks Lead Tuesday’s Selloff as Trump’s Greenland Rhetoric Rattles Markets
• Negative Sentiment: CEO Satya Nadella’s Davos comments warning of an AI “bubble” if adoption doesn’t broaden, and his notes on rising AI capex and energy costs, have added caution among investors about margin pressure and industry concentration risk. Satya Nadella’s biggest AI bubble warning yet is a challenge to the Fortune 500: it’s time to reinvent the knowledge worker

Institutional Inflows and Outflows

Several large investors have recently modified their holdings of the stock. Norges Bank purchased a new stake in shares of Microsoft during the second quarter worth about $50,493,678,000. Kingstone Capital Partners Texas LLC lifted its holdings in Microsoft by 564,387.1% in the 2nd quarter. Kingstone Capital Partners Texas LLC now owns 90,549,369 shares of the software giant’s stock worth $45,040,162,000 after buying an additional 90,533,328 shares during the period. Nuveen LLC purchased a new position in shares of Microsoft during the first quarter valued at approximately $18,733,827,000. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC lifted its stake in Microsoft by 500.0% in the third quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 59,543,261 shares of the software giant’s stock worth $30,840,432,000 after acquiring an additional 49,618,571 shares during the period. Finally, Laurel Wealth Advisors LLC increased its position in Microsoft by 49,640.3% during the 2nd quarter. Laurel Wealth Advisors LLC now owns 29,967,038 shares of the software giant’s stock valued at $14,905,904,000 after purchasing an additional 29,906,791 shares during the period. Hedge funds and other institutional investors own 71.13% of the company’s stock.

Microsoft Stock Down 1.2%

The company’s fifty day simple moving average is $483.04 and its 200 day simple moving average is $502.46. The company has a current ratio of 1.40, a quick ratio of 1.39 and a debt-to-equity ratio of 0.10. The firm has a market capitalization of $3.38 trillion, a P/E ratio of 32.33, a price-to-earnings-growth ratio of 1.72 and a beta of 1.07.

Microsoft (NASDAQ:MSFT) last announced its quarterly earnings results on Wednesday, October 29th. The software giant reported $4.13 earnings per share (EPS) for the quarter, beating the consensus estimate of $3.65 by $0.48. Microsoft had a net margin of 35.71% and a return on equity of 32.45%. The company had revenue of $77.67 billion for the quarter, compared to analysts’ expectations of $75.49 billion. During the same quarter in the previous year, the company earned $3.30 earnings per share. Microsoft’s quarterly revenue was up 18.4% on a year-over-year basis. Research analysts expect that Microsoft Corporation will post 13.08 EPS for the current year.

Microsoft Dividend Announcement

The firm also recently announced a quarterly dividend, which will be paid on Thursday, March 12th. Shareholders of record on Thursday, February 19th will be paid a dividend of $0.91 per share. The ex-dividend date of this dividend is Thursday, February 19th. This represents a $3.64 dividend on an annualized basis and a dividend yield of 0.8%. Microsoft’s dividend payout ratio (DPR) is currently 25.89%.

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).