Erste Group Bank Increases Earnings Estimates for Microsoft

Microsoft Corporation (NASDAQ:MSFT) – Erste Group Bank increased their FY2027 EPS estimates for shares of Microsoft in a research note issued on Thursday, August 27th. Erste Group Bank analyst H. Engel now expects that the software giant will earn $19.58 per share for the year, up from their prior estimate of $19.54. The consensus estimate for Microsoft’s current full-year earnings is $19.59 per share. Erste Group Bank also issued estimates for Microsoft’s FY2028 earnings at $23.38 EPS.

Several other research firms have also weighed in on MSFT. Wedbush reiterated an “outperform” rating and issued a $575.00 target price on shares of Microsoft in a report on Wednesday, May 13th. Morgan Stanley reaffirmed an “overweight” rating on shares of Microsoft in a research report on Thursday, July 30th. BMO Capital Markets upped their price objective on Microsoft from $500.00 to $515.00 and gave the company an “outperform” rating in a report on Thursday, July 30th. Sanford C. Bernstein set a $660.00 price objective on Microsoft in a research report on Monday, August 10th. Finally, Weiss Ratings raised Microsoft from a “hold (c)” rating to a “hold (c+)” rating in a research note on Thursday. Forty-two investment analysts have rated the stock with a Buy rating and five have assigned a Hold rating to the stock. According to MarketBeat, the company presently has an average rating of “Moderate Buy” and a consensus target price of $560.27.

Microsoft Price Performance

Microsoft stock opened at $507.29 on Monday. The company has a current ratio of 1.23, a quick ratio of 1.22 and a debt-to-equity ratio of 0.07. The company has a 50-day moving average price of $433.67 and a 200 day moving average price of $413.10. Microsoft has a 12-month low of $349.20 and a 12-month high of $553.72. The stock has a market cap of $3.77 trillion, a P/E ratio of 28.25, a PEG ratio of 1.65 and a beta of 1.10.

Microsoft (NASDAQ:MSFT) last posted its quarterly earnings results on Wednesday, July 29th. The software giant reported $4.74 EPS for the quarter, topping the consensus estimate of $4.24 by $0.50. Microsoft had a return on equity of 31.98% and a net margin of 40.31%.The business had revenue of $90.01 billion for the quarter, compared to analyst estimates of $87.62 billion. During the same quarter in the previous year, the firm earned $3.65 EPS. The company’s quarterly revenue was up 17.7% compared to the same quarter last year.

Microsoft Announces Dividend

The business also recently disclosed a quarterly dividend, which will be paid on Thursday, September 10th. Stockholders of record on Thursday, August 20th will be issued a $0.91 dividend. This represents a $3.64 annualized dividend and a dividend yield of 0.7%. The ex-dividend date is Thursday, August 20th. Microsoft’s dividend payout ratio is currently 20.27%.

Insider Buying and Selling

In other news, CEO Judson Althoff sold 10,000 shares of the firm’s 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 completion of the transaction, the chief executive officer directly owned 100,447 shares in the company, valued at $49,007,086.83. This trade represents a 9.05% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available at the SEC website. Also, EVP Takeshi Numoto sold 4,810 shares of Microsoft stock in a transaction on Tuesday, August 4th. The shares were sold at an average price of $496.48, for a total value of $2,388,068.80. Following the completion of the sale, the executive vice president directly owned 42,677 shares of the company’s stock, valued at $21,188,276.96. The trade was a 10.13% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Insiders have sold a total of 21,810 shares of company stock valued at $10,110,874 in the last ninety days. 0.03% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Microsoft

Several institutional investors have recently bought and sold shares of the company. Vanguard Group Inc. boosted its holdings in Microsoft by 2.3% in the fourth quarter. Vanguard Group Inc. now owns 717,942,580 shares of the software giant’s stock valued at $347,211,391,000 after purchasing an additional 15,955,898 shares during the period. State Street Corp increased its holdings in Microsoft by 2.1% during the 4th quarter. State Street Corp now owns 306,150,608 shares of the software giant’s stock worth $148,060,557,000 after purchasing an additional 6,388,930 shares during the period. Geode Capital Management LLC raised its position in Microsoft by 1.1% in the 4th quarter. Geode Capital Management LLC now owns 182,618,400 shares of the software giant’s stock valued at $88,056,019,000 after purchasing an additional 1,911,142 shares in the last quarter. Morgan Stanley raised its position in Microsoft by 0.8% in the 4th quarter. Morgan Stanley now owns 121,220,561 shares of the software giant’s stock valued at $58,624,690,000 after purchasing an additional 980,439 shares in the last quarter. Finally, Norges Bank purchased a new position in shares of Microsoft in the 4th quarter valued at about $50,664,631,000. 71.13% of the stock is owned by institutional investors and hedge funds.

Key Microsoft News

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Microsoft and Saudi Arabia’s HUMAIN expanded their strategic partnership, introducing enterprise AI offerings and an AI-enabled PC. The agreement supports Microsoft’s effort to expand Azure and Copilot-related AI adoption internationally. Microsoft and HUMAIN Expand Strategic Collaboration at LEAP 2026 with New Enterprise AI Offering and AI PC
• Positive Sentiment: Goldman Sachs expects elevated AI capital spending to continue into 2027. Sustained demand for cloud computing, data-center capacity and AI infrastructure could benefit Microsoft’s Azure business, although it also implies significant ongoing investment. Here comes the AI capex shocker, Goldman Sachs says
• Positive Sentiment: Analyst commentary remains constructive, with Citizens analyst Patrick Walravens anticipating that Microsoft could retest its record high over the next 12 months. Erste Group also raised its fiscal 2027 EPS estimate, reinforcing the bullish view on earnings growth. Wall Street analyst sets Microsoft stock price target for next 12 months
• Neutral Sentiment: Microsoft is expected to announce its annual dividend increase in September. Its last six increases were between 9% and 11%, but the size of the upcoming raise remains uncertain; the news offers income support rather than an immediate earnings catalyst. Microsoft Has Raised Its Dividend Every Year for More Than a Decade
• Negative Sentiment: Microsoft Outlook experienced an outage that disrupted email access, while OpenAI’s ChatGPT Work reported elevated errors and latency. Although likely temporary, the incidents raise concerns about service reliability across productivity and AI products. Microsoft Outlook and OpenAI’s ChatGPT Work are experiencing user outages
• Negative Sentiment: Investors are also focused on the power, water and electricity demands associated with Microsoft’s expanding data-center footprint. Infrastructure bottlenecks and rising AI-related capital requirements could pressure margins and increase execution risk. Microsoft Stock Slips as Its Magic Word for Data Centers Emerges
• Negative Sentiment: Microsoft acknowledged that a Windows 11 update can cause broken mouse cursors and black desktop wallpapers. The issue is unlikely to materially affect financial results, but it adds to near-term product-reliability concerns. Microsoft Admits Windows 11 Update Breaks Mouse Cursors

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).