Microsoft shares can reach $ 500, despite short -term weakness News ad

Microsoft Today

$ 414.99 -27.34 (-6.18%)

As of 04:00 on the East

52-week range

$ 385.58

▼

$ 468.35

Dividend yield

0.80%

P/e ratio.

34.24

Value is valuable

$ 509.72

Microsoft NASDAQ: MSFT The price of shares fell by more than 6% after the FQ2 profit and loss report and violated the ascending trend, but it does not matter. The results were strong, and the long -term opportunity compensates for the weak leadership. Critical details in the report are the accelerating growth of AI services.

Acceleration underlies its cloud segment, even though the Azure growth has slowed down and confirmed the long -term prospects of AI. This includes a boom of services, which is larger and longer than in the process of infrastructure. The forecast for the growth of the industry of artificial intelligence services is reliable and continues to grow, waiting for 36% CAGR over the next seven years or longer.

Microsoft surpasses in the second quarter: the leadership of a weak but relatively high bar

Microsoft had a solid quarter, which provided double -digit revenue growth and a significant edge. Pure company revenue in the amount of 69.6 billion dollars. The United States has grown by more than 12% compared to last year in all significant segments. As for products compared to services, sales of products fell by 14% and were compensated by an increased increase in services by 22%. More personal calculations are the only weak place on the segment, and its business is flat. Productivity and business processes increased by 14%, which led to an increase in intellectual calculations by 19%. IC growth was due to 21% increase in Microsoft Cloud revenue, including a significant increase in Azure by 31%.

Margin News is also strong, including improved gross and operational results. Operating profit increased by 17%, leaving GAAP income at $ 3.23 or by 0.13 US dollars above the Marketbeat consensus. GAAP revenues increased by only 10% compared to 12.2% with an ax, but they are affected by an increase in investments, which are expected to maintain growth in the long term. Investment plans include 50% annual increase in data center expenses in order to strengthen the cloud position of the company and promote AI Services business.

Guide news is why the price of shares has fallen. The company confirmed its previously specified forecast by adding the influence of new meetings of FX. Microsoft expects currency transformation to reduce about 2% of the upper line and affect the margin. The conclusion, however, consists in the fact that the results of the FQ3 include another quarter of double -digit top -level growth, a strong margin and a significant cash flow, despite an increase in investment. The cash flow in the second quarter was sufficient to maintain the forecasts of capital profitability and improve the balance, including reduction of debt, the total responsibility and increase the shareholder capital of shareholders by 12.75%.

Mood analysts remain solid: Microsoft reached $ 500.

The positive response of analysts to the results and update of Microsoft will help maintain the price of its shares over time. Marketbeat has tracked a single change in the target price decrease due to numerous repeated ratings and goals. They, including a decrease in the target price, attach shares with a moderate purchase and predict the transition to the level of $ 500 or higher by the end of the year, consistent with wider trends. Wider trends in analysts include an increase in the coating and the target price, which increased by 20% in 12 months, which indicates an increase in shares by 25% in 2025.

Microsoft assessment is a problem, but compensated by long -term prospects. Its 34-time incomes are numerous today with the most successful technological companies that are a highly protected group, but this is more than 50% of the S&P 500 Award with a slowdown in the forecast growth. However, despite the slowdown, it is expected that the revenue will support the low -grade CAGR until 2025, and the income will grow a little faster. In this scenario, the price of the company for several funds for a wide market by 2030 is reduced below, which indicates the value of the prospect.

The technical action after the release concerns, but the main line of the trend was broken. The gap in the trend can lead to a change in action, but in this case a deep decline is unlikely. A more likely scenario is that Microsoft’s price trend has switched on the side and will continue to move within the established range. The low end of the range is about $ 400, and a maximum of about $ 460. Beneficity to growth, but this can take a quarter or two before the start of the next upward trend and a new maximum is installed.

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