Why Microsoft Stock Is Still a ‘Buy’

Wall Street analysts on MSFT

So far in this series, we’ve looked at Microsoft’s (MSFT) increased initiatives and its improved stance in the cloud space. Although Amazon (AMZN) continues to be the undisputed leader in the overall cloud space, Microsoft is posing stiff competition, aided by the increased adoption of Azure, Office, and Dynamics 365. Microsoft currently leads the overall enterprise SaaS (software-as-a-service) space.

Of the 36 analyst recommendations on Microsoft stock, more than 70% are “buy” recommendations as of June 29, 2017, while 7% are “hold.” There is only one “sell” recommendation.
Why Microsoft Stock Is Still a ‘Buy’
The increased adoption of Microsoft’s cloud offerings increased adoption and its strategic acquisitions in rapidly growing areas like cybersecurity have enhanced analysts’ views of the stock. A few research houses in recent months have raised their price targets for MSFT. The cloud space’s consistent rapid growth has meanwhile improved market sentiment.

The increased adoption of Microsoft’s cloud offerings increased adoption and its strategic acquisitions in rapidly growing areas like cybersecurity have enhanced analysts’ views of the stock. A few research houses in recent months have raised their price targets for MSFT. The cloud space’s consistent rapid growth has meanwhile improved market sentiment.

Specifically, Cleveland Research rates Microsoft as a “buy,” with a price target of $80. Morgan Stanley (MS) reiterated Microsoft stock’s “overweight” rating and raised its price target from $72.00 to $80.00.

Stock price performance

Microsoft’s stock performance, however, has been negative for the past month. On June 29, 2017, Microsoft’s stock fell ~2.1% from the previous month. However, it has risen ~37.5% in the past year.

The analysts’ consensus target price for Microsoft was $74.73 per share on June 29, 2017. The median target price was $77. Microsoft’s closing price was $68.49 that day.