Upon analyzing the recent post-earnings pullback of Microsoft stock, analysts on Wall Street seem to agree that this presents a lucrative buying opportunity for investors. Despite a 1% dip in share prices following disappointing cloud revenue figures, the overall results for the fiscal fourth quarter were more robust than expected. Microsoft’s Intelligent Cloud segment generated $28.52 billion in revenue, slightly below the $28.68 billion anticipated by analysts. However, experts believe that this temporary weakness in the cloud sector creates an entry point for investors, as Microsoft’s cloud growth is expected to reaccelerate in the coming months.
Goldman Sachs Analyst Kash Rangan maintained a buy rating on Microsoft and reaffirmed his price target of $515 per share, implying a substantial 22% upside potential. Rangan highlighted Microsoft’s strong presence across all layers of the cloud stack, positioning the company to capitalize on long-term secular trends such as Gen-AI, public cloud consumption, SaaS adoption, and digital transformation. With a wide range of offerings in AI/ML, BI/analytics, and DevOps, Microsoft is seen as well-positioned for sustained growth in the technology sector.
JPMorgan Chase Analyst Mark Murphy echoed Rangan’s optimism, maintaining an overweight rating on Microsoft with a $470 price target. Despite the short-term setback in cloud revenue, Murphy emphasized the clear long-term potential of Azure and AI technologies. He pointed out that while non-AI consumption may have dipped slightly in the last quarter, customer demand signals indicate a positive trend in CapEx and anticipated reacceleration of Azure growth in the first half of the calendar year 2025. Murphy’s forecast suggests an 11% upside for Microsoft shares in the future.
Wells Fargo’s Bullish Forecast
Wells Fargo Analyst Michael Turrin raised his price target to $515 and reiterated an overweight rating on Microsoft, affirming his confidence in the stock’s future performance. Turrin advised investors not to be discouraged by near-term weaknesses in share prices, as he expects Microsoft to maintain its growth momentum in essential IT categories. With a strong position in multiple end markets and a solid financial profile showing durable margin expansion, Microsoft is poised for continued success. Despite trading at historical highs, Turrin believes that Microsoft’s early lead in AI and its strong market position justify the current valuation.
Analysts’ outlook on Microsoft stock remains overwhelmingly positive, with expectations of growth and innovation in the cloud and AI sectors driving investor confidence. The recent pullback in share prices is seen as a temporary setback, offering a strategic buying opportunity for those looking to capitalize on Microsoft’s long-term potential in the technology industry.