Microsoft (NASDAQ:MSFT) Trading Down 1.4% – Here’s Why

Microsoft Corporation (NASDAQ:MSFT) dropped 1.4% during mid-day trading on Wednesday . The company traded as low as $381.33 and last traded at $383.34. Approximately 24,775,102 shares changed hands during trading, a decline of 35% from the average session volume of 37,825,523 shares. The stock had previously closed at $388.84.

Key Stories Impacting Microsoft

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Microsoft is expanding use of its in-house MAI models in Office apps like Excel and Outlook, a move that could reduce AI costs and improve long-term margins. Microsoft joins AI cost-cutting trend by relying more on its own models
• Positive Sentiment: Several market commentators say Microsoft looks undervalued after its recent selloff, with Azure and AI growth still strong enough to support a rebound. Microsoft: The Tech Bargain To Buy For H2
• Neutral Sentiment: Tech sector sentiment was generally firmer, which may be helping offset some of Microsoft’s company-specific weakness. Sector Update: Tech Stocks Rise Wednesday Afternoon
• Negative Sentiment: Microsoft is cutting thousands of jobs and restructuring Xbox after weak performance, underscoring pressure in its gaming business. Microsoft Is Downsizing Its Xbox Unit. Will That Rescue Its Stock?
• Negative Sentiment: New class-action lawsuit headlines tied to alleged investor harm and Copilot/Azure disclosure issues add legal uncertainty. Bronstein, Gewirtz & Grossman LLC Urges Microsoft Corporation Investors to Act: Class Action Filed Alleging Investor Harm

Wall Street Analyst Weigh In

Several equities research analysts have issued reports on the company. Royal Bank Of Canada reaffirmed a “buy” rating on shares of Microsoft in a research note on Friday, May 22nd. Wolfe Research decreased their price objective on Microsoft from $570.00 to $525.00 and set an “outperform” rating on the stock in a report on Monday. Tigress Financial boosted their target price on Microsoft from $595.00 to $680.00 and gave the stock a “buy” rating in a research report on Wednesday, May 6th. Bank of America started coverage on Microsoft in a research note on Tuesday, March 24th. They issued a “buy” rating and a $500.00 target price for the company. Finally, Phillip Securities upgraded shares of Microsoft to a “buy” rating and set a $485.00 price target on the stock in a research report on Wednesday, May 13th. Forty equities research analysts have rated the stock with a Buy rating and seven have issued a Hold rating to the company. According to MarketBeat.com, Microsoft has a consensus rating of “Moderate Buy” and an average price target of $560.98.

Microsoft Stock Performance

The company has a current ratio of 1.28, a quick ratio of 1.27 and a debt-to-equity ratio of 0.08. The business has a fifty day moving average of $404.84 and a 200-day moving average of $416.21. The company has a market cap of $2.85 trillion, a PE ratio of 22.82, a P/E/G ratio of 1.21 and a beta of 1.13.

Microsoft (NASDAQ:MSFT) last posted its earnings results on Wednesday, April 29th. The software giant reported $4.27 EPS for the quarter, topping the consensus estimate of $4.06 by $0.21. The firm had revenue of $82.89 billion during the quarter, compared to analysts’ expectations of $81.44 billion. Microsoft had a net margin of 39.34% and a return on equity of 31.94%. The company’s quarterly revenue was up 18.3% compared to the same quarter last year. During the same period last year, the company posted $3.46 EPS. Equities research analysts anticipate that Microsoft Corporation will post 16.76 earnings per share for the current fiscal year.

Microsoft Dividend Announcement

The business also recently disclosed a quarterly dividend, which will be paid on Thursday, September 10th. Shareholders of record on Thursday, August 20th will be issued a $0.91 dividend. The ex-dividend date is Thursday, August 20th. This represents a $3.64 annualized dividend and a yield of 0.9%. Microsoft’s dividend payout ratio (DPR) is 21.67%.

Insider Buying and Selling at Microsoft

In related news, CEO Judson Althoff sold 15,500 shares of the firm’s stock in a transaction that occurred on Monday, June 1st. The stock was sold at an average price of $460.99, for a total transaction of $7,145,345.00. Following the completion of the transaction, the chief executive officer owned 110,477 shares of the company’s stock, valued at $50,928,792.23. This trade represents a 12.30% decrease in their position. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, EVP Amy Coleman sold 1,262 shares of Microsoft stock in a transaction on Thursday, May 14th. The shares were sold at an average price of $411.34, for a total value of $519,111.08. Following the transaction, the executive vice president owned 46,003 shares of the company’s stock, valued at $18,922,874.02. The trade was a 2.67% decrease in their position. The SEC filing for this sale provides additional information. In the last three months, insiders have sold 23,762 shares of company stock valued at $10,508,361. 0.03% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Microsoft

Several large investors have recently modified their holdings of the stock. WFA Asset Management Corp grew its holdings in shares of Microsoft by 27.0% in the first quarter. WFA Asset Management Corp now owns 1,016 shares of the software giant’s stock worth $427,000 after acquiring an additional 216 shares during the period. Ironwood Wealth Management LLC. boosted its position in Microsoft by 0.3% in the second quarter. Ironwood Wealth Management LLC. now owns 12,658 shares of the software giant’s stock worth $5,658,000 after purchasing an additional 38 shares during the last quarter. Discipline Wealth Solutions LLC grew its stake in shares of Microsoft by 410.4% during the 3rd quarter. Discipline Wealth Solutions LLC now owns 2,659 shares of the software giant’s stock valued at $1,144,000 after purchasing an additional 2,138 shares during the period. Wealth Group Ltd. grew its stake in shares of Microsoft by 1.2% during the 4th quarter. Wealth Group Ltd. now owns 2,374 shares of the software giant’s stock valued at $1,000,000 after purchasing an additional 28 shares during the period. Finally, Eagle Capital Management LLC increased its position in shares of Microsoft by 0.4% during the 4th quarter. Eagle Capital Management LLC now owns 23,097 shares of the software giant’s stock valued at $9,735,000 after purchasing an additional 96 shares during the last quarter. Hedge funds and other institutional investors own 71.13% of the company’s stock.

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).