Guggenheim Maintains Neutral Rating on Microsoft Shares

On January 27, 2025, Guggenheim reiterated their neutral rating on Microsoft Corporation (NASDAQ:MSFT – Free Report) in a report distributed early on Friday, as reported by Benzinga. This rating reflects the analysts' cautious perspective on the stock amid various market dynamics.

Microsoft has recently been the focus of several research reports, highlighting the varying opinions from different financial institutions. For instance, BMO Capital Markets adjusted their price target for Microsoft shares from $500.00 to $495.00 while maintaining an “outperform” rating in a report released on October 31. Additionally, on January 22, StockNews.com upgraded Microsoft from a “hold” rating to a “buy” rating, indicating a more positive outlook on the stock's future performance.

Citigroup also revised their target price, reducing it from $500.00 to $497.00 and maintaining a “buy” rating on October 23. Conversely, Oppenheimer downgraded their rating from “outperform” to “market perform” on October 8. KeyCorp was more optimistic, increasing their target price from $490.00 to $505.00 and giving the stock an “overweight” rating on October 18.

According to data from MarketBeat.com, Microsoft currently has a consensus of three investment analysts rating the stock as a hold, while twenty-seven have assigned it a buy rating, and one analyst has given it a strong buy recommendation. The average analyst rating stands at “Moderate Buy” with a consensus price target of $512.66.

Microsoft Stock Performance Overview

Microsoft shares opened at $444.06 on Friday. The company’s financial metrics show a debt-to-equity ratio of 0.15, a current ratio of 1.30, and a quick ratio of 1.29. The fifty-day moving average price for the stock is $431.05, while the two-hundred-day moving average price stands at $425.54. Over the past year, the stock reached a low of $385.58 and a high of $468.35, reflecting significant volatility. Microsoft maintains a substantial market cap of $3.30 trillion, a P/E ratio of 36.64, a P/E/G ratio of 2.40, and a beta of 0.90, indicating less volatility compared to the overall market.

In its most recent earnings report posted on October 30, Microsoft exceeded expectations with earnings per share (EPS) of $3.30, surpassing the consensus estimate of $3.10 by $0.20. The company reported revenue of $65.59 billion, higher than analyst forecasts of $64.57 billion. Microsoft achieved a net margin of 35.61% and a return on equity of 34.56%, demonstrating strong profitability. Compared to the previous year, Microsoft’s revenue increased by 16.0%, alongside an EPS rise from $2.99.

Dividend Announcement from Microsoft

Recently, Microsoft announced a quarterly dividend payment that is set to occur on March 13, with stockholders of record on February 20 eligible for a $0.83 dividend per share. The ex-dividend date is also February 20. This dividend represents an annual payout of $3.32, resulting in a yield of 0.75%. Currently, Microsoft’s dividend payout ratio (DPR) is 27.39%, adding to its appeal as an income-generating investment.

Insider Transactions at Microsoft

In related corporate news, Chief Marketing Officer Takeshi Numoto sold 1,000 shares on November 22 at an average price of $414.72, totaling $414,720.00 in value, which decreased his ownership stake by 1.71%. Post-sale, he retained 57,511 shares valued at around $23,850,961.92. Additionally, Executive Vice President Judson Althoff sold 25,000 shares in the same period, securing $10,425,000.00 at an average price of $417.00 and reducing his ownership by 17.57% to 117,294 shares worth approximately $48,911,598.00. In the last ninety days, insiders have sold a total of 41,200 shares worth about $17,383,892, while insiders hold only 0.03% of the company stock.

Institutional Investor Activity

Recent movements among institutional investors have also been observed, with several modifying their stakes in Microsoft. For example, Christopher J. Hasenberg Inc increased its position in the company by 169.2%, owning 70 shares now valued at $31,000, following the purchase of 44 additional shares. Similarly, Fiduciary Advisors Inc acquired new shares worth $38,000 in the fourth quarter. Other noteworthy changes include Quarry LP's new position with a value of $45,000, and IFS Advisors LLC boosting their holdings by 53.8% to own shares worth $42,000. Aggregate data shows that institutional investors and hedge funds hold 71.13% of Microsoft shares, reflecting strong institutional interest in the company.

About Microsoft

Microsoft Corporation is a global leader in software, services, devices, and solutions. Its Product and Business Processes segment includes offerings like Office, Exchange, SharePoint, and Microsoft Teams, as well as Microsoft 365 services, catering to both consumers and businesses.

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