Microsoft’s (MSFT) Outperform Rating Reiterated at Royal Bank Of Canada

Royal Bank Of Canada restated their outperform rating on shares of Microsoft (NASDAQ:MSFT) in a research note released on Thursday morning,Benzinga reports. Royal Bank Of Canada currently has a $640.00 price objective on the software giant’s stock.

MSFT has been the topic of a number of other research reports. Cantor Fitzgerald increased their price objective on shares of Microsoft from $608.00 to $630.00 and gave the stock an “overweight” rating in a report on Thursday. Rothschild & Co Redburn set a $440.00 target price on shares of Microsoft in a research note on Monday, September 21st. Guggenheim upped their target price on shares of Microsoft from $586.00 to $595.00 and gave the stock a “buy” rating in a research report on Thursday. Evercore upgraded shares of Microsoft from an “underperform” rating to an “outperform” rating in a research report on Monday, October 5th. Finally, Scotiabank raised their price target on shares of Microsoft from $625.00 to $650.00 and gave the company a “sector outperform” rating in a research note on Thursday. One research analyst has rated the stock with a Strong Buy rating, forty-five have issued a Buy rating and four have assigned a Hold rating to the company’s stock. According to MarketBeat.com, Microsoft presently has a consensus rating of “Moderate Buy” and an average price target of $609.54.

Microsoft Trading Down 1.6%

NASDAQ:MSFT opened at $521.91 on Thursday. The firm has a market capitalization of $3.88 trillion, a P/E ratio of 27.24, a P/E/G ratio of 1.64 and a beta of 1.10. The business has a 50 day simple moving average of $512.91 and a 200 day simple moving average of $438.43. The company has a debt-to-equity ratio of 0.07, a current ratio of 1.22 and a quick ratio of 1.22. Microsoft has a 12-month low of $349.20 and a 12-month high of $551.15.

Microsoft (NASDAQ:MSFT) last issued 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 analyst estimates of $90.62 billion. Microsoft had a return on equity of 31.28% and a net margin of 41.17%. The firm’s revenue for the quarter was up 18.8% on a year-over-year basis. During the same period last year, the company earned $4.13 earnings per share. Equities research analysts predict that Microsoft will post 19.79 EPS for the current year.

Microsoft Increases Dividend

The business also recently disclosed a quarterly dividend, which will be paid on Thursday, December 10th. Stockholders of record on Thursday, November 19th will be paid a dividend of $0.98 per share. The ex-dividend date of this dividend is Thursday, November 19th. This represents a $3.92 annualized dividend and a dividend yield of 0.8%. This is a boost from Microsoft’s previous quarterly dividend of $0.91. Microsoft’s dividend payout ratio is 19.00%.

Insider Buying and Selling

In other news, EVP Amy Hood sold 41,674 shares of the business’s stock in a transaction on Monday, September 14th. The stock was sold at an average price of $498.27, for a total transaction of $20,764,903.98. Following the sale, the executive vice president directly owned 533,624 shares of the company’s stock, valued at $265,888,830.48. The trade was a 7.24% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, EVP Takeshi Numoto sold 4,810 shares of the business’s stock in a transaction on Tuesday, August 4th. The stock was sold at an average price of $496.48, for a total value of $2,388,068.80. Following the sale, the executive vice president directly owned 42,677 shares in the company, valued at $21,188,276.96. This trade represents a 10.13% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Over the last quarter, insiders have sold 150,314 shares of company stock valued at $75,404,992. Insiders own 0.03% of the company’s stock.

Institutional Trading of Microsoft

Institutional investors and hedge funds have recently bought and sold shares of the stock. Bank of America Corp DE acquired a new position in shares of Microsoft in the second quarter worth $27,338,370,000. Legal & General Group Plc purchased a new stake in shares of Microsoft during the second quarter worth $18,306,443,000. Jupiter Topco LLC acquired a new stake in Microsoft during the second quarter valued at $6,928,664,000. Canada Pension Plan Investment Board purchased a new position in Microsoft in the second quarter valued at about $5,653,812,000. Finally, The Manufacturers Life Insurance Company purchased a new position in Microsoft in the second quarter valued at about $4,000,706,000. Institutional investors and hedge funds own 71.13% of the company’s stock.

Key Headlines Impacting Microsoft

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Microsoft delivered a strong fiscal first quarter, with revenue of $92.28 billion and EPS of $4.89, both above expectations. Azure revenue surged 48%, while Microsoft Cloud revenue rose 30%, reinforcing the view that AI demand is translating into meaningful cloud growth. Microsoft Earnings Expose a Growing Divide in the Magnificent 7 AI Trade
• Positive Sentiment: Management issued second-quarter revenue guidance of $96.0 billion to $97.1 billion, above the $95.7 billion consensus estimate. Analysts responded with multiple price-target increases, including targets of $630 to $680, and Wolfe Research upgraded the stock to “strong buy.”
• Positive Sentiment: Microsoft’s strong cash generation and diversified enterprise business continue to distinguish it from rivals facing sharper cash-flow concerns. Analysts argue that Azure, Copilot, AI agents and Microsoft’s security products provide several ways to monetize AI. The expanded Estée Lauder partnership, which will extend Copilot to more than 14,000 employees, offers another example of enterprise adoption. Estée Lauder and Microsoft Strategic Partnership
• Neutral Sentiment: Microsoft’s voluntary exit offer for approximately 60,000 employees may improve productivity and redirect resources toward AI, but it also highlights a significant restructuring as the company shifts toward more automated, equipment-intensive operations. Microsoft’s 60,000-Person Buyout Offer
• Negative Sentiment: Investors remain concerned about Microsoft’s capital intensity. The company plans roughly $170 billion of AI-related capital spending, while also arranging a $25 billion bond sale—the first major U.S. debt offering since 2017—to fund its buildout. Rising borrowing costs increase scrutiny of future AI returns. Microsoft Plans to Raise $25 Billion in Debt
• Negative Sentiment: Quarterly capital spending was below analyst expectations because third-party AI-chip and data-center capacity was delayed, pushing some capacity into the first half of 2027. While management described this as a supply issue rather than weaker demand, the miss hurt AI infrastructure suppliers and revived concerns about the pace of expansion.
• Negative Sentiment: Microsoft’s cloud gross margin is reportedly narrowing as chip, power, data-center and labor costs rise. With the Nasdaq 100 down sharply during October amid fears of an AI spending bubble, investors are demanding proof that Microsoft’s large backlog will convert into profitable cash flow—not merely future revenue.

About Microsoft

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.