High Volume of Microsoft Call Options Indicates Strong Investor Interest

On Tuesday, Microsoft Co. (NASDAQ:MSFT - Get Free Report) experienced significant options trading activity, with investors purchasing 355,575 call options. This figure marks a notable 29% increase compared to the typical daily volume of 274,666 call options, indicating heightened investor interest in the company.

Recent Insider Activity at Microsoft

In addition to the options trading, there was also notable insider activity within Microsoft. On August 23rd, CEO Satya Nadella sold 14,398 shares of the company at an average price of $417.41, totaling roughly $6,009,869.18. Following this sale, Nadella retained 786,933 shares valued at approximately $328,473,703.53, reflecting no change in his ownership percentage.

Additionally, Bradford L. Smith, another insider, sold 40,000 shares on September 9th for an average price of $402.59, amounting to $16,103,600.00. Post-transaction, Smith holds 544,847 shares valued at $219,349,953.73. In total, corporate insiders have sold 190,629 shares over the past three months, totaling $77,916,485 in value. Currently, insiders own 0.03% of Microsoft's stock.

Hedge Fund Activities

Recently, several hedge funds have adjusted their stakes in Microsoft. For instance, Banque Cantonale Vaudoise increased its holding by 1.8%, now owning 282,295 shares valued at $118,766,000. Meanwhile, Wedmont Private Capital boosted its stake by 5.1%, owning 80,247 shares currently worth $34,208,000. Other firms, such as Bank of New Hampshire and Grassi Investment Management, also increased their holdings, reflecting a strong institutional interest with 71.13% of Microsoft currently owned by hedge funds and institutional investors.

Wall Street Analysts' Outlook

Analysts have been optimistic about Microsoft's future. TD Cowen raised their target price from $470.00 to $495.00 with a "buy" rating. Similarly, Royal Bank of Canada maintained an "outperform" rating, setting a price objective of $500.00. Overall, the consensus among analysts is a "Moderate Buy" rating based on data from MarketBeat, with an average target price of $495.68.

Current Stock Performance

As of Tuesday's midday trading, Microsoft (NASDAQ: MSFT) increased by 2.1%, reaching $427.51. The trading volume was also higher than average, at 23,863,133 shares traded against the normal volume of 20,286,785. Microsoft has a market capitalization of approximately $3.18 trillion, a PE ratio of 37.05, and the stock's performance in the past year has shown a low of $324.39 and a high of $468.35.

In its latest earnings report announced on July 30th, Microsoft claimed earnings of $2.95 per share, exceeding analysts' expectations of $2.90. The company also reported revenues of $64.73 billion, surpassing the estimated $64.38 billion. Analysts predict Microsoft will have a $13.02 earnings per share for the current year.

Dividend Announcement

Microsoft disclosed its quarterly dividend plan recently, announcing a payment date of December 12th. Stockholders on record by November 21st will receive $0.83 per share, translating to an annualized dividend of $3.32 and a yield of 0.78%. This increase from the previous quarterly dividend of $0.75 highlights the company's commitment to returning value to its shareholders.

About Microsoft

Microsoft Corporation develops and provides a wide range of software, services, and solutions across the globe. Its offerings include products like Office, Microsoft Teams, and various cloud services aimed at enhancing productivity and collaboration.

Microsoft, Options, Traders