Track market-moving stories before they get noisy

These days, I see Microsoft (MSFT +1.02%) less as an old software giant and more as a core AI utility for the global economy, and that shift changes how I think about the stock. With Azure, the company's cloud platform, growing north of 40% and AI revenue already running at a $37 billion annual pace, I believe Microsoft still has what it needs to beat the market into 2027 and beyond.

Image source: Getty Images.

I start with the numbers only to understand the scale. In fiscal 2026 (ending June 30), Microsoft reported $331.8 billion in revenue, up 18%, and operating income of $155.2 billion, up 21%. Azure revenue surpassed $100 billion for the year, and in the most recent quarter, Azure and other cloud services jumped 43%, topping expectations. Those results tell me AI demand is showing up in actual sales and profits.

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Microsoft is now an AI stock The figure that changed how I think about Microsoft is the AI run rate. Management disclosed in its third-quarter call that the AI business has reached a $37 billion annual revenue run rate, up 123% from a year earlier. That includes revenue from Azure AI services, Microsoft 365 Copilot, GitHub Copilot, and other first-party AI tools. A year ago, many investors were asking if AI would ever show up as real money. Now there is a concrete number that sits next to Azure and Office.

I view Copilot as a key piece of the puzzle. Early this year, Microsoft had more than 450 million commercial Microsoft 365 seats. At the start of 2026, only a small slice of those users paid for Copilot. Since then, paid Microsoft 365 Copilot seats have passed 30 million and are rising every quarter, with large enterprises rolling it out to most information workers. Every percentage point of conversion adds billions in high-margin subscription revenue on top of existing licenses. For me, that is what a durable AI business looks like. It sits within tools people use daily and increases average revenue per user, rather than relying on one-off projects.

The company still spends lots of money Of course, none of this comes free. Microsoft is tracking toward roughly $120 billion or more in AI-related capital expenditure in fiscal 2026 and an adjusted calendar 2026 capex plan around $175 billion, with about $25 billion tied to higher component prices for graphics processing units and memory.

That level of spending would scare me if I did not see evidence that the infrastructure is turning into cash. Gross margin dollars and operating income grew faster than revenue, even with heavy AI investment, which suggests Microsoft is finding ways to spread costs across many services and keep margins healthy.

I also pay attention to how experts perceive the stock. Right now, Microsoft carries dozens of "Buy" ratings from analysts who cover the stock and virtually no "Sell" ratings, with the median price target from analysts surveyed by Yahoo! Finance of $569, representing potential upside of 17% from current levels.

That is not a guarantee of future returns, but it reflects a shared view that Microsoft's AI business is becoming a growth engine. In simple terms, this is no longer just a "safe" defensive tech name. It is treated as a leader in the AI infrastructure race alongside Nvidia.

So, is Microsoft a good buy? For me, the answer is yes, with a clear condition. You have to believe the company will stay at the center of enterprise AI, not just chase the trend. When I look at Azure's growth, the Copilot seat counts, the $37 billion AI run rate, and the scale of data center investment, I see a company that has already crossed that line.

The S&P 500 is up by more than 10% this year, and its growth has outpaced Microsoft (MSFT +1.01%), but I don't think that trend will last too much longer. Microsoft's 20% return over the past month shows that more investors are spotting the opportunity.

Its earnings results were the major catalyst behind the surge, and there were a few details in the report that make me think Microsoft is a more promising investment now than the broad-market S&P 500.

Image source: Getty Images.

Cloud computing revenue continues to grow Most of Microsoft's growth is coming from its cloud computing unit. Revenues from that part of the business were up by 27% year over year in Microsoft's fiscal 2026 fourth quarter.

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This segment has maintained high growth rates for many quarters, and I believe that trend will continue. Artificial intelligence (AI) has boosted enterprise demand for cloud platforms. Competitors like Amazon (AMZN +1.24%) and Alphabet (GOOG +1.37%) (GOOGL +1.46%) have reported strong demand for their cloud platforms that continues to accelerate.

Cloud computing operates on a recurring revenue model, and Microsoft's established customers will have to upgrade their plans as their needs evolve. It's extremely cumbersome to switch from one cloud platform to another, and it's not worth the effort if the differences between Microsoft, Amazon, and Alphabet are marginal.

Microsoft continues to enhance its cloud offering to boost retention and attract new customers. Microsoft Cloud provides a broad model catalog of more than 11,000 models. This selection aids customers that want "the right model for each task, based on quality, latency, cost, and compliance," per the earnings call transcript.

Other business segments are also doing nicely I still view cloud computing as the major story for Microsoft, and continued growth in this segment will help the tech stock outperform the S&P 500 in the future. It accounted for roughly two-thirds of Microsoft's revenue in its fiscal 2026 Q4, but the businesses that generated the remaining third of sales still show some upside potential too.

Artificial intelligence has also translated into higher growth rates for Microsoft's other businesses. LinkedIn and online advertising revenue were up by 12% and 10% year over year, respectively.

Microsoft 365 commercial cloud revenue also rose 16% year over year. The company's "more personal computing" segment, which includes online ads, Xbox, and Windows OEM and devices, was down by 4% year over year. While I would prefer if every segment were delivering revenue growth, this part of Microsoft's business only represented 14.3% of total sales.

Microsoft stock may be suffering from the company's success. While some growth investors are chasing smaller AI stocks in the hopes of more substantial gains, Microsoft steadily delivers better fundamentals each quarter.

Overall revenue and operating income were both up by 18% year over year in the most recent quarter. Those numbers beat most companies in the S&P 500, and to top it off, Microsoft has a lower price-to-earnings (P/E) ratio than the index. These factors explain why I view Microsoft as a better opportunity than the market's most popular benchmark.

The S&P 500 has a lot of dead weight It's not just that Microsoft is a great stock. I also believe investors should look deeper into any index fund or exchange-traded fund they want to buy. For instance, the S&P 500 has recently derived a large portion of its gains from the "Magnificent Seven" stocks, but a closer look reveals many stocks are flat or down this year.

More than 150 S&P 500 holdings are down year to date, while fewer than half of the stocks in this index have a 10% return or higher.

Admittedly, Microsoft is in neither of those categories. It's up year to date, but not by much. However, Microsoft's stock price movements have not kept pace with its improving fundamentals. Meanwhile, some S&P 500 stocks are overextended and more vulnerable to future corrections.

Tech stocks like Microsoft often do the heavy lifting for the S&P 500, and the stock price should eventually catch up with Microsoft's fundamental growth. That's why I like Microsoft better than the S&P 500.

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Based on their value, growth, and momentum characteristics, each stock is assigned a rating of A, B, C, D, or F. The better the score, the better chance the stock will outperform; an A is better than a B, a B is better than a C, and so on.

The Style Scores are broken down into four categories:

Value ScoreFinding good stocks at good prices, and discovering which companies are trading under their true value, are what value investors like to focus on. So, the Value Style Score takes into account ratios like P/E, PEG, Price/Sales, Price/Cash Flow, and a host of other multiples to highlight the most attractive and discounted stocks.

Growth ScoreGrowth investors are more concerned with a stock's future prospects, and the overall financial health and strength of a company. Thus, the Growth Style Score analyzes characteristics like projected and historic earnings, sales, and cash flow to find stocks that will see sustainable growth over time.

Momentum ScoreMomentum traders and investors live by the saying "the trend is your friend." This investing style is all about taking advantage of upward or downward trends in a stock's price or earnings outlook. Employing factors like one-week price change and the monthly percentage change in earnings estimates, the Momentum Style Score can indicate favorable times to build a position in high-momentum stocks.

VGM ScoreIf you like to use all three kinds of investing, then the VGM Score is for you. It's a combination of all Style Scores, and is an important indicator to use with the Zacks Rank. The VGM Score rates each stock on their shared weighted styles, narrowing down the companies with the most attractive value, best growth forecast, and most promising momentum.

How Style Scores Work with the Zacks Rank A proprietary stock-rating model, the Zacks Rank utilizes the power of earnings estimate revisions, or changes to a company's earnings outlook, to help investors create a successful portfolio.

#1 (Strong Buy) stocks have produced an unmatched +23.8% average annual return since 1988, which is more than double the S&P 500's performance over the same time frame. However, the Zacks Rank examines a ton of stocks, and there can be more than 200 companies with a Strong Buy rank, and another 600 with a #2 (Buy) rank, on any given day.

But it can feel overwhelming to pick the right stocks for you and your investing goals with over 800 top-rated stocks to choose from.

That's where the Style Scores come in.

To have the best chance of big returns, you'll want to always consider stocks with a Zacks Rank #1 or #2 that also have Style Scores of A or B, which will give you the highest probability of success. If you're looking at stocks with a #3 (Hold) rank, it's important they have Scores of A or B as well to ensure as much upside potential as possible.

Since the Scores were created to work together with the Zacks Rank, the direction of a stock's earnings estimate revisions should be a key factor when choosing which stocks to buy.

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Thus, the more stocks you own with a #1 or #2 Rank and Scores of A or B, the better.

Stock to Watch: Microsoft (MSFT - Free Report) Redmond, WA-based Microsoft Corporation is one of the largest broad-based technology providers in the world. The company holds the leading position in the PC software market with its Windows operating system. 

MSFT is a #3 (Hold) on the Zacks Rank, with a VGM Score of B.

Momentum investors should take note of this Computer and Technology stock. MSFT has a Momentum Style Score of B, and shares are up 26.6% over the past four weeks.

For fiscal 2027, 12 analysts revised their earnings estimate upwards in the last 60 days, and the Zacks Consensus Estimate has increased $0.29 to $19.59 per share. MSFT boasts an average earnings surprise of +9.3%.

With a solid Zacks Rank and top-tier Momentum and VGM Style Scores, MSFT should be on investors' short list.

Beacon Investment Advisory Services Inc. reduced its holdings in Microsoft Corporation (NASDAQ:MSFT – Free Report) by 1.8% in the second quarter, according to the company in its most recent Form 13F filing with the SEC. The institutional investor owned 181,210 shares of the software giant’s stock after selling 3,335 shares during the quarter. Microsoft comprises 2.5% of Beacon Investment Advisory Services Inc.’s holdings, making the stock its 7th largest holding. Beacon Investment Advisory Services Inc.’s holdings in Microsoft were worth $67,595,000 as of its most recent SEC filing.

Several other institutional investors have also recently made changes to their positions in the stock. Markel Group Inc. increased its position in shares of Microsoft by 0.4% during the first quarter. Markel Group Inc. now owns 537,630 shares of the software giant’s stock worth $199,014,000 after purchasing an additional 1,950 shares in the last quarter. Bessemer Group Inc. increased its position in Microsoft by 8.4% during the first quarter. Bessemer Group Inc. now owns 6,921,677 shares of the software giant’s stock worth $2,562,197,000 after purchasing an additional 537,634 shares during the last quarter. Taylor Securities Services Inc. purchased a new stake in shares of Microsoft during the 4th quarter valued at approximately $2,616,000. Werba Rubin Papier Wealth Management raised its position in Microsoft by 15.7% in the fourth quarter. Werba Rubin Papier Wealth Management now owns 12,492 shares of the software giant’s stock valued at $6,041,000 after purchasing an additional 1,698 shares during the period. Finally, Harel Insurance Investments & Financial Services Ltd. lifted its position in Microsoft by 138.8% in the first quarter. Harel Insurance Investments & Financial Services Ltd. now owns 1,356,359 shares of the software giant’s stock valued at $502,077,000 after buying an additional 788,297 shares during the last quarter. Institutional investors and hedge funds own 71.13% of the company’s stock.

Analyst Upgrades and Downgrades A number of brokerages recently commented on MSFT. HSBC lowered their target price on Microsoft from $593.00 to $571.00 in a report on Thursday, April 30th. BMO Capital Markets raised their price target on Microsoft from $500.00 to $515.00 and gave the company an “outperform” rating in a research note on Thursday, July 30th. Guggenheim reissued a “buy” rating and set a $586.00 price objective on shares of Microsoft in a report on Monday, July 27th. Phillip Securities downgraded Microsoft from a “strong-buy” rating to a “moderate buy” rating in a report on Monday, August 3rd. Finally, Royal Bank Of Canada reiterated an “outperform” rating and issued a $640.00 price target on shares of Microsoft in a research report on Thursday, July 30th. Forty-two research analysts have rated the stock with a Buy rating and five have assigned a Hold rating to the company’s stock. Based on data from MarketBeat, the stock presently has an average rating of “Moderate Buy” and an average price target of $560.27.

Read Our Latest Report on MSFT Insider Activity In other news, CEO Judson Althoff sold 15,500 shares of the business’s stock in a transaction that occurred on Monday, June 1st. The stock was sold at an average price of $460.99, for a total value of $7,145,345.00. Following the completion of the sale, the chief executive officer directly owned 110,477 shares in the company, valued at approximately $50,928,792.23. The trade was a 12.30% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which can be accessed through this hyperlink. Also, EVP Takeshi Numoto sold 4,810 shares of the stock in a transaction on Tuesday, August 4th. The stock was sold at an average price of $496.48, for a total transaction 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. The SEC filing for this sale provides additional information. Insiders sold 37,310 shares of company stock worth $17,256,219 over the last three months. 0.03% of the stock is currently owned by corporate insiders.

Key Headlines Impacting Microsoft Here are the key news stories impacting Microsoft this week:

Positive Sentiment: Microsoft is reportedly preparing to launch its Maia 300 AI accelerator as soon as this fall and is discussing production with TSMC. Developing proprietary chips could reduce long-term reliance on Nvidia, improve supply-chain control, and support Microsoft’s expanding AI infrastructure. Microsoft’s Betting Big on Its Own AI Chips Positive Sentiment: Meta has reportedly become one of Microsoft’s largest Azure AI customers, spending hundreds of millions of dollars annually and consuming substantial computing capacity. The relationship reinforces evidence that enterprise demand is translating into Azure revenue. Meta Emerges as a Major Microsoft Azure AI Client Positive Sentiment: Microsoft raised its quarterly dividend to $0.91 per share, while Azure revenue reportedly surpassed $100 billion. Analysts and financial commentators also highlighted a roughly $678 billion backlog and continued strong demand for cloud and AI services. Microsoft Raises Dividend as AI Capital Spending Hits Record Levels Neutral Sentiment: Microsoft approved the Horizon 1 Texas data-center project involving IREN, potentially expanding capacity available for AI workloads. The development is strategically relevant, although the near-term financial benefit to Microsoft remains unclear. Microsoft Accepts Horizon 1 Negative Sentiment: Annual capital spending has climbed nearly 80% to about $115.9 billion, while free cash flow declined. Investors remain focused on whether AI revenue growth will generate adequate returns on this spending. Microsoft Spent $115.9 Billion on AI Negative Sentiment: TCI Management reportedly exited its Microsoft position and increased its Alphabet stake, adding a notable institutional-selling signal. Separately, commentary warned that Microsoft’s valuation depends on optimistic earnings forecasts, while higher bond yields could reduce the present value of future AI profits. TCI Exits Microsoft Microsoft Price Performance Shares of NASDAQ MSFT opened at $483.24 on Monday. The firm’s 50-day moving average is $419.61 and its two-hundred day moving average is $409.20. The company has a market capitalization of $3.59 trillion, a PE ratio of 26.91, a price-to-earnings-growth ratio of 1.56 and a beta of 1.10. The company has a debt-to-equity ratio of 0.07, a current ratio of 1.23 and a quick ratio of 1.22. Microsoft Corporation has a 12-month low of $349.20 and a 12-month high of $553.72.

Microsoft (NASDAQ:MSFT – Get Free Report) last issued its quarterly earnings results on Wednesday, July 29th. The software giant reported $4.74 EPS for the quarter, topping analysts’ consensus estimates of $4.24 by $0.50. The business had revenue of $90.01 billion during the quarter, compared to the consensus estimate of $87.62 billion. Microsoft had a net margin of 40.31% and a return on equity of 31.98%. The company’s quarterly revenue was up 17.7% compared to the same quarter last year. During the same period in the previous year, the firm posted $3.65 earnings per share. Equities analysts anticipate that Microsoft Corporation will post 19.59 EPS for the current fiscal year.

Microsoft Announces Dividend The firm also recently announced a quarterly dividend, which will be paid on Thursday, September 10th. Stockholders of record on Thursday, August 20th will be paid a $0.91 dividend. This represents a $3.64 dividend on an annualized basis and a dividend yield of 0.8%. The ex-dividend date of this dividend is Thursday, August 20th. Microsoft’s dividend payout ratio (DPR) is currently 20.27%.

Microsoft Company Profile (Free Report)

Microsoft Corporation is a global technology company headquartered in Redmond, Washington. Founded in 1975 by Bill Gates and Paul Allen, Microsoft develops, licenses and supports a broad range of software products, services and devices for consumers, enterprises and governments worldwide. Its operations span personal computing, productivity software, cloud infrastructure, enterprise applications, developer tools and gaming.

Microsoft’s product portfolio includes the Windows operating system and the Microsoft 365 suite of productivity and collaboration tools (Office apps, Outlook, Teams).

Featured Stories Five stocks we like better than Microsoft VIG, VYM, and VYMI: Which Vanguard Dividend ETF Is Right for You? 3 Closed-End Funds to Maximize Dividend Payments Rocket Lab’s Sell-Off Is Fading—Is It Finally Safe to Buy? $27 Billion in Buybacks: 3 Stocks Betting Their Strong Runs Aren’t Over Want to see what other hedge funds are holding MSFT? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Microsoft Corporation (NASDAQ:MSFT – Free Report).

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Bright Rock Capital Management LLC grew its position in Microsoft Corporation (NASDAQ:MSFT – Free Report) by 15.6% in the second quarter, according to the company in its most recent 13F filing with the Securities and Exchange Commission (SEC). The firm owned 74,000 shares of the software giant’s stock after acquiring an additional 10,000 shares during the period. Microsoft comprises about 5.5% of Bright Rock Capital Management LLC’s portfolio, making the stock its 2nd largest holding. Bright Rock Capital Management LLC’s holdings in Microsoft were worth $27,603,000 at the end of the most recent reporting period.

Several other institutional investors also recently modified their holdings of MSFT. Thurston Springer Miller Herd & Titak Inc. raised its holdings in shares of Microsoft by 29.7% in the 2nd quarter. Thurston Springer Miller Herd & Titak Inc. now owns 21,388 shares of the software giant’s stock valued at $7,979,000 after purchasing an additional 4,902 shares during the period. Invariant Investment Management grew its holdings in Microsoft by 11.6% during the second quarter. Invariant Investment Management now owns 979 shares of the software giant’s stock worth $379,000 after purchasing an additional 102 shares during the period. Foresight Capital Management Advisors Inc. increased its position in Microsoft by 5.3% during the second quarter. Foresight Capital Management Advisors Inc. now owns 7,233 shares of the software giant’s stock worth $2,698,000 after buying an additional 363 shares during the last quarter. Beacon Financial Strategies CORP increased its position in Microsoft by 6.0% during the second quarter. Beacon Financial Strategies CORP now owns 972 shares of the software giant’s stock worth $363,000 after buying an additional 55 shares during the last quarter. Finally, Quantum Financial Advisors LLC raised its stake in Microsoft by 6.5% in the second quarter. Quantum Financial Advisors LLC now owns 17,205 shares of the software giant’s stock valued at $6,418,000 after buying an additional 1,054 shares during the period. 71.13% of the stock is currently owned by institutional investors and hedge funds.

Analysts Set New Price Targets MSFT has been the subject of a number of recent analyst reports. Dbs Bank cut their price objective on Microsoft from $678.00 to $573.00 in a research report on Thursday, May 7th. Cantor Fitzgerald increased their price target on Microsoft from $502.00 to $522.00 and gave the company an “overweight” rating in a research note on Monday, July 27th. China Renaissance cut their price target on Microsoft from $630.00 to $550.00 and set a “buy” rating for the company in a report on Monday, May 4th. Arete Research raised their price target on Microsoft from $730.00 to $870.00 and gave the company a “buy” rating in a report on Tuesday, May 5th. Finally, Raymond James Financial cut shares of Microsoft from a “market perform” rating to a “market perform” rating in a research report on Tuesday, May 5th. Forty-two investment analysts have rated the stock with a Buy rating and five have assigned a Hold rating to the stock. According to MarketBeat.com, the stock currently has an average rating of “Moderate Buy” and a consensus price target of $560.27.

View Our Latest Stock Report on MSFT Microsoft Stock Performance Shares of MSFT stock opened at $483.24 on Monday. The stock has a market cap of $3.59 trillion, a P/E ratio of 26.91, a price-to-earnings-growth ratio of 1.56 and a beta of 1.10. Microsoft Corporation has a 1 year low of $349.20 and a 1 year high of $553.72. The company has a current ratio of 1.23, a quick ratio of 1.22 and a debt-to-equity ratio of 0.07. The stock has a 50 day simple moving average of $419.61 and a 200 day simple moving average of $409.20.

Microsoft (NASDAQ:MSFT – Get Free Report) last announced its quarterly earnings data on Wednesday, July 29th. The software giant reported $4.74 earnings per share for the quarter, beating the consensus estimate of $4.24 by $0.50. The firm had revenue of $90.01 billion during the quarter, compared to analysts’ expectations of $87.62 billion. Microsoft had a return on equity of 31.98% and a net margin of 40.31%.The company’s quarterly revenue was up 17.7% compared to the same quarter last year. During the same period in the previous year, the firm earned $3.65 EPS. On average, research analysts predict that Microsoft Corporation will post 19.59 earnings per share for the current fiscal year.

Microsoft Dividend Announcement The business also recently declared a quarterly dividend, which will be paid on Thursday, September 10th. Investors of record on Thursday, August 20th will be paid a $0.91 dividend. This represents a $3.64 dividend on an annualized basis and a yield of 0.8%. The ex-dividend date of this dividend is Thursday, August 20th. Microsoft’s payout ratio is 20.27%.

Insider Activity In related news, EVP Takeshi Numoto sold 4,810 shares of the company’s stock in a transaction on Tuesday, August 4th. The stock was sold at an average price of $496.48, for a total transaction of $2,388,068.80. Following the completion of the sale, the executive vice president directly owned 42,677 shares in the company, valued at $21,188,276.96. This represents a 10.13% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available through this link. Also, CEO Judson Althoff sold 10,000 shares of the stock in a transaction dated Wednesday, August 5th. The stock was sold at an average price of $487.89, for a total transaction of $4,878,900.00. Following the completion of the transaction, the chief executive officer directly owned 100,447 shares of the company’s stock, valued at $49,007,086.83. This trade represents a 9.05% decrease in their position. The SEC filing for this sale provides additional information. Insiders have sold 37,310 shares of company stock valued at $17,256,219 in the last ninety days. 0.03% of the stock is currently owned by company insiders.

More Microsoft News Here are the key news stories impacting Microsoft this week:

Positive Sentiment: Microsoft is reportedly preparing to launch its Maia 300 AI accelerator as soon as this fall and is discussing production with TSMC. Developing proprietary chips could reduce long-term reliance on Nvidia, improve supply-chain control, and support Microsoft’s expanding AI infrastructure. Microsoft’s Betting Big on Its Own AI Chips Positive Sentiment: Meta has reportedly become one of Microsoft’s largest Azure AI customers, spending hundreds of millions of dollars annually and consuming substantial computing capacity. The relationship reinforces evidence that enterprise demand is translating into Azure revenue. Meta Emerges as a Major Microsoft Azure AI Client Positive Sentiment: Microsoft raised its quarterly dividend to $0.91 per share, while Azure revenue reportedly surpassed $100 billion. Analysts and financial commentators also highlighted a roughly $678 billion backlog and continued strong demand for cloud and AI services. Microsoft Raises Dividend as AI Capital Spending Hits Record Levels Neutral Sentiment: Microsoft approved the Horizon 1 Texas data-center project involving IREN, potentially expanding capacity available for AI workloads. The development is strategically relevant, although the near-term financial benefit to Microsoft remains unclear. Microsoft Accepts Horizon 1 Negative Sentiment: Annual capital spending has climbed nearly 80% to about $115.9 billion, while free cash flow declined. Investors remain focused on whether AI revenue growth will generate adequate returns on this spending. Microsoft Spent $115.9 Billion on AI Negative Sentiment: TCI Management reportedly exited its Microsoft position and increased its Alphabet stake, adding a notable institutional-selling signal. Separately, commentary warned that Microsoft’s valuation depends on optimistic earnings forecasts, while higher bond yields could reduce the present value of future AI profits. TCI Exits Microsoft Microsoft Profile (Free Report)

Microsoft Corporation is a global technology company headquartered in Redmond, Washington. Founded in 1975 by Bill Gates and Paul Allen, Microsoft develops, licenses and supports a broad range of software products, services and devices for consumers, enterprises and governments worldwide. Its operations span personal computing, productivity software, cloud infrastructure, enterprise applications, developer tools and gaming.

Microsoft’s product portfolio includes the Windows operating system and the Microsoft 365 suite of productivity and collaboration tools (Office apps, Outlook, Teams).

Featured Articles Five stocks we like better than Microsoft VIG, VYM, and VYMI: Which Vanguard Dividend ETF Is Right for You? 3 Closed-End Funds to Maximize Dividend Payments Rocket Lab’s Sell-Off Is Fading—Is It Finally Safe to Buy? $27 Billion in Buybacks: 3 Stocks Betting Their Strong Runs Aren’t Over

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Microsoft (MSFT) is back to being a magnificent Mag 7 stock after earnings. David Wagner is very bullish on the stock's upward momentum due to its diversified business model through Azure cloud and Office suite working in tandem with each other to maximize profits.

Few topics have been as widely discussed in recent years as artificial intelligence (AI). It has taken over the tech world, the business world, and seemingly everything in between. The many companies with their hands in the AI pot all rely on one core thing: data centers.

Data centers are the backbone of AI, but demand for what they can provide is being far outweighed by electricity needs. This isn't the best news for AI hyperscalers (companies that operate large cloud platforms), but it's working in favor of the following two companies.

Image source: The Motley Fool.

1. Constellation Energy Hyperscalers need two things: 24/7 access to massive amounts of power and power that is as green as possible. That's where Constellation Energy (CEG -0.01%) comes into the picture. Constellation is a clean energy company with the largest nuclear power fleet in the U.S.

Nuclear power is a good go-to because energy sources like natural gas emit carbon emissions, and it's not feasible to expect that much 24/7 power from wind or solar. Nuclear power, on the other hand, is carbon-free and can run continuously.

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If you want to see just how much nuclear energy is in demand, look no further than Constellation's 20-year power purchase agreement with Microsoft (MSFT +0.43%). As part of the deal, Microsoft is restarting the Three Mile Island nuclear facility (now called the Crane Clean Energy Center) in Pennsylvania, with Constellation supplying the plant's energy.

Microsoft's willingness to sign a two-decade agreement underscores the importance of long-term, reliable energy sources for hyperscalers. They're spending hundreds of billions building data centers, but they're only useful if there's enough power to run them. Although the stock is down over 25% year to date through Aug. 20, it presents a better buying opportunity for long-term investors.

2. GE Vernova GE Vernova (GEV -0.95%) doesn't focus on the electricity that data centers need. Instead, it focuses on the hardware required to generate and distribute power.

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Demand for GE Vernova's hardware has surged due to data center build-outs. Through the first half of this year, data center power equipment has generated $5 billion for the company, more than double what it brought in all of last year.

GE Vernova is a good way to get exposure to the infrastructure portion of the AI build-out. It's one of the go-to hardware suppliers, solidifying its place in the power supply chain. And with a backlog of $176 billion, it has guaranteed future revenue that essentially provides a floor for its top line.

Some investors may worry the rally is over, given the stock is up over 42% this year and 194% since the start of 2025. However, it's still in a strong position to produce good long-term results. Expect higher-than-usual volatility, though. That has been a common theme over the past year.

Cohen Capital Management Inc. grew its position in shares of Microsoft Corporation (NASDAQ:MSFT – Free Report) by 2.3% during the 2nd quarter, according to the company in its most recent filing with the Securities & Exchange Commission. The institutional investor owned 74,681 shares of the software giant’s stock after buying an additional 1,700 shares during the quarter. Microsoft accounts for approximately 3.8% of Cohen Capital Management Inc.’s investment portfolio, making the stock its 3rd biggest holding. Cohen Capital Management Inc.’s holdings in Microsoft were worth $27,858,000 at the end of the most recent quarter.

A number of other hedge funds and other institutional investors have also recently modified their holdings of MSFT. Longfellow Investment Management Co. LLC increased its position in shares of Microsoft by 51.3% during the 2nd quarter. Longfellow Investment Management Co. LLC now owns 59 shares of the software giant’s stock valued at $29,000 after purchasing an additional 20 shares during the last quarter. Bernzott Capital Advisors bought a new stake in shares of Microsoft during the 4th quarter worth $34,000. Timmons Wealth Management LLC purchased a new position in shares of Microsoft in the 4th quarter worth about $36,000. Fairway Wealth LLC increased its holdings in Microsoft by 287.0% during the fourth quarter. Fairway Wealth LLC now owns 89 shares of the software giant’s stock worth $43,000 after buying an additional 66 shares during the last quarter. Finally, LSV Asset Management bought a new stake in Microsoft in the fourth quarter worth about $44,000. Hedge funds and other institutional investors own 71.13% of the company’s stock.

Insider Buying and Selling at Microsoft In other news, CEO Judson Althoff sold 15,500 shares of the company’s stock in a transaction on Monday, June 1st. The shares were sold at an average price of $460.99, for a total value of $7,145,345.00. Following the transaction, the chief executive officer owned 110,477 shares of the company’s stock, valued at approximately $50,928,792.23. This represents a 12.30% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which can be accessed through the SEC website. Also, EVP Takeshi Numoto sold 4,810 shares of the 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 completion of the sale, the executive vice president owned 42,677 shares in the company, valued at $21,188,276.96. This trade represents a 10.13% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. In the last ninety days, insiders sold 37,310 shares of company stock worth $17,256,219. Insiders own 0.03% of the company’s stock.

Analysts Set New Price Targets A number of research analysts have weighed in on the stock. Scotiabank reiterated an “outperform” rating and issued a $510.00 target price on shares of Microsoft in a research note on Thursday, July 30th. China Renaissance lowered their price target on shares of Microsoft from $630.00 to $550.00 and set a “buy” rating on the stock in a report on Monday, May 4th. Royal Bank Of Canada reiterated an “outperform” rating and issued a $640.00 price objective on shares of Microsoft in a research note on Thursday, July 30th. Citigroup reissued a “buy” rating and set a $600.00 price objective (up from $570.00) on shares of Microsoft in a report on Tuesday, July 28th. Finally, Argus decreased their target price on Microsoft from $620.00 to $510.00 and set a “buy” rating for the company in a research report on Friday, July 10th. Forty-two investment analysts have rated the stock with a Buy rating and five have given a Hold rating to the company’s stock. According to data from MarketBeat, the company currently has an average rating of “Moderate Buy” and an average target price of $560.27. Check Out Our Latest Analysis on MSFT

Microsoft Price Performance MSFT stock opened at $483.24 on Friday. The firm has a 50 day moving average of $419.61 and a 200-day moving average of $409.30. The company has a current ratio of 1.23, a quick ratio of 1.22 and a debt-to-equity ratio of 0.07. Microsoft Corporation has a 12 month low of $349.20 and a 12 month high of $553.72. The firm has a market capitalization of $3.59 trillion, a P/E ratio of 26.91, a price-to-earnings-growth ratio of 1.56 and a beta of 1.11.

Microsoft (NASDAQ:MSFT – Get Free Report) last posted its earnings results on Wednesday, July 29th. The software giant reported $4.74 earnings per share for the quarter, topping analysts’ consensus estimates of $4.24 by $0.50. Microsoft had a net margin of 40.31% and a return on equity of 31.98%. The business had revenue of $90.01 billion for the quarter, compared to analyst estimates of $87.62 billion. During the same quarter in the prior year, the firm posted $3.65 EPS. Microsoft’s revenue was up 17.7% on a year-over-year basis. As a group, sell-side analysts predict that Microsoft Corporation will post 19.59 earnings per share for the current fiscal year.

Microsoft Dividend Announcement The company also recently declared a quarterly dividend, which will be paid on Thursday, September 10th. Stockholders of record on Thursday, August 20th will be given a dividend of $0.91 per share. This represents a $3.64 dividend on an annualized basis and a dividend yield of 0.8%. The ex-dividend date is Thursday, August 20th. Microsoft’s payout ratio is 20.27%.

Key Headlines Impacting Microsoft Here are the key news stories impacting Microsoft this week:

Positive Sentiment: Microsoft is reportedly preparing to launch its Maia 300 AI accelerator as soon as this fall and is discussing production with TSMC. Developing proprietary chips could reduce long-term reliance on Nvidia, improve supply-chain control, and support Microsoft’s expanding AI infrastructure. Microsoft’s Betting Big on Its Own AI Chips Positive Sentiment: Meta has reportedly become one of Microsoft’s largest Azure AI customers, spending hundreds of millions of dollars annually and consuming substantial computing capacity. The relationship reinforces evidence that enterprise demand is translating into Azure revenue. Meta Emerges as a Major Microsoft Azure AI Client Positive Sentiment: Microsoft raised its quarterly dividend to $0.91 per share, while Azure revenue reportedly surpassed $100 billion. Analysts and financial commentators also highlighted a roughly $678 billion backlog and continued strong demand for cloud and AI services. Microsoft Raises Dividend as AI Capital Spending Hits Record Levels Neutral Sentiment: Microsoft approved the Horizon 1 Texas data-center project involving IREN, potentially expanding capacity available for AI workloads. The development is strategically relevant, although the near-term financial benefit to Microsoft remains unclear. Microsoft Accepts Horizon 1 Negative Sentiment: Annual capital spending has climbed nearly 80% to about $115.9 billion, while free cash flow declined. Investors remain focused on whether AI revenue growth will generate adequate returns on this spending. Microsoft Spent $115.9 Billion on AI Negative Sentiment: TCI Management reportedly exited its Microsoft position and increased its Alphabet stake, adding a notable institutional-selling signal. Separately, commentary warned that Microsoft’s valuation depends on optimistic earnings forecasts, while higher bond yields could reduce the present value of future AI profits. TCI Exits Microsoft Microsoft Profile (Free Report)

Microsoft Corporation is a global technology company headquartered in Redmond, Washington. Founded in 1975 by Bill Gates and Paul Allen, Microsoft develops, licenses and supports a broad range of software products, services and devices for consumers, enterprises and governments worldwide. Its operations span personal computing, productivity software, cloud infrastructure, enterprise applications, developer tools and gaming.

Microsoft’s product portfolio includes the Windows operating system and the Microsoft 365 suite of productivity and collaboration tools (Office apps, Outlook, Teams).

Read More Five stocks we like better than Microsoft 2 Biotech Stocks Shaping Up for Major Breakouts 3 Stocks Came Roaring Back—Now They’re Flashing Warning Signs 3 Beaten-Down Stocks That Haven’t Gotten the Message About the S&P 500’s Record Run Darden Restaurants Just Hit a 52-Week High–Is the Olive Garden Comeback Story Legit?

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Byrne Asset Management LLC trimmed its holdings in Microsoft Corporation (NASDAQ:MSFT – Free Report) by 6.0% in the second quarter, according to its most recent disclosure with the Securities & Exchange Commission. The institutional investor owned 18,971 shares of the software giant’s stock after selling 1,216 shares during the quarter. Microsoft comprises approximately 3.8% of Byrne Asset Management LLC’s portfolio, making the stock its 3rd biggest position. Byrne Asset Management LLC’s holdings in Microsoft were worth $7,077,000 as of its most recent SEC filing.

Several other institutional investors have also modified their holdings of MSFT. WFA Asset Management Corp lifted its position in Microsoft by 27.0% in the first quarter. WFA Asset Management Corp now owns 1,016 shares of the software giant’s stock valued at $427,000 after acquiring an additional 216 shares during the last quarter. Ironwood Wealth Management LLC. boosted its position in shares of Microsoft by 0.3% in the 2nd quarter. Ironwood Wealth Management LLC. now owns 12,658 shares of the software giant’s stock valued at $5,658,000 after purchasing an additional 38 shares during the period. Discipline Wealth Solutions LLC grew its stake in Microsoft by 410.4% during the 3rd quarter. Discipline Wealth Solutions LLC now owns 2,659 shares of the software giant’s stock worth $1,144,000 after buying an additional 2,138 shares during the last quarter. Wealth Group Ltd. boosted its holdings in shares of Microsoft by 1.2% in the fourth quarter. Wealth Group Ltd. now owns 2,374 shares of the software giant’s stock valued at $1,000,000 after acquiring an additional 28 shares during the period. Finally, Eagle Capital Management LLC grew its position in shares of Microsoft by 0.4% during the fourth quarter. Eagle Capital Management LLC now owns 23,097 shares of the software giant’s stock worth $9,735,000 after acquiring an additional 96 shares during the last quarter. Hedge funds and other institutional investors own 71.13% of the company’s stock.

Trending Headlines about Microsoft Here are the key news stories impacting Microsoft this week:

Positive Sentiment: Microsoft is reportedly preparing to launch its Maia 300 AI accelerator as soon as this fall and is discussing production with TSMC. Developing proprietary chips could reduce long-term reliance on Nvidia, improve supply-chain control, and support Microsoft’s expanding AI infrastructure. Microsoft’s Betting Big on Its Own AI Chips Positive Sentiment: Meta has reportedly become one of Microsoft’s largest Azure AI customers, spending hundreds of millions of dollars annually and consuming substantial computing capacity. The relationship reinforces evidence that enterprise demand is translating into Azure revenue. Meta Emerges as a Major Microsoft Azure AI Client Positive Sentiment: Microsoft raised its quarterly dividend to $0.91 per share, while Azure revenue reportedly surpassed $100 billion. Analysts and financial commentators also highlighted a roughly $678 billion backlog and continued strong demand for cloud and AI services. Microsoft Raises Dividend as AI Capital Spending Hits Record Levels Neutral Sentiment: Microsoft approved the Horizon 1 Texas data-center project involving IREN, potentially expanding capacity available for AI workloads. The development is strategically relevant, although the near-term financial benefit to Microsoft remains unclear. Microsoft Accepts Horizon 1 Negative Sentiment: Annual capital spending has climbed nearly 80% to about $115.9 billion, while free cash flow declined. Investors remain focused on whether AI revenue growth will generate adequate returns on this spending. Microsoft Spent $115.9 Billion on AI Negative Sentiment: TCI Management reportedly exited its Microsoft position and increased its Alphabet stake, adding a notable institutional-selling signal. Separately, commentary warned that Microsoft’s valuation depends on optimistic earnings forecasts, while higher bond yields could reduce the present value of future AI profits. TCI Exits Microsoft Wall Street Analysts Forecast Growth A number of analysts recently weighed in on MSFT shares. Evercore set a $528.00 price target on shares of Microsoft in a research note on Thursday, July 30th. Wolfe Research reaffirmed an “outperform” rating and issued a $550.00 target price on shares of Microsoft in a report on Thursday, July 30th. Argus decreased their target price on shares of Microsoft from $620.00 to $510.00 and set a “buy” rating for the company in a research note on Friday, July 10th. China Renaissance dropped their price target on Microsoft from $630.00 to $550.00 and set a “buy” rating on the stock in a research report on Monday, May 4th. Finally, HSBC decreased their price objective on Microsoft from $593.00 to $571.00 in a research report on Thursday, April 30th. Forty-two equities research analysts have rated the stock with a Buy rating and five have assigned a Hold rating to the company’s stock. Based on data from MarketBeat.com, Microsoft has a consensus rating of “Moderate Buy” and an average target price of $560.27. Read Our Latest Stock Report on MSFT

Insider Buying and Selling In related news, EVP Takeshi Numoto sold 4,810 shares of the firm’s stock in a transaction that occurred 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 completion of the transaction, the executive vice president directly owned 42,677 shares of the company’s stock, valued at $21,188,276.96. This trade represents a 10.13% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is available at this hyperlink. Also, CEO Judson Althoff sold 10,000 shares of the firm’s stock in a transaction that occurred on Wednesday, August 5th. The shares were sold at an average price of $487.89, for a total value of $4,878,900.00. Following the completion of the transaction, the chief executive officer directly owned 100,447 shares of the company’s stock, valued at $49,007,086.83. The trade was a 9.05% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Over the last quarter, insiders have sold 37,310 shares of company stock valued at $17,256,219. Insiders own 0.03% of the company’s stock.

Microsoft Stock Up 0.4% Microsoft stock opened at $483.24 on Friday. The stock’s 50 day moving average price is $419.61 and its 200 day moving average price is $409.30. Microsoft Corporation has a 1-year low of $349.20 and a 1-year high of $553.72. The company has a market cap of $3.59 trillion, a PE ratio of 26.91, a price-to-earnings-growth ratio of 1.56 and a beta of 1.11. The company has a debt-to-equity ratio of 0.07, a current ratio of 1.23 and a quick ratio of 1.22.

Microsoft (NASDAQ:MSFT – Get Free Report) last released its quarterly earnings data on Wednesday, July 29th. The software giant reported $4.74 earnings per share (EPS) for the quarter, topping the consensus estimate of $4.24 by $0.50. Microsoft had a return on equity of 31.98% and a net margin of 40.31%.The firm had revenue of $90.01 billion during the quarter, compared to analysts’ expectations of $87.62 billion. During the same quarter in the prior year, the business posted $3.65 earnings per share. Microsoft’s revenue was up 17.7% compared to the same quarter last year. On average, sell-side analysts predict that Microsoft Corporation will post 19.59 EPS for the current fiscal year.

Microsoft Announces Dividend The business also recently announced a quarterly dividend, which will be paid on Thursday, September 10th. Shareholders of record on Thursday, August 20th will be issued a $0.91 dividend. The ex-dividend date of this dividend is Thursday, August 20th. This represents a $3.64 dividend on an annualized basis and a yield of 0.8%. Microsoft’s dividend payout ratio (DPR) is 20.27%.

Microsoft Company Profile (Free Report)

Microsoft Corporation is a global technology company headquartered in Redmond, Washington. Founded in 1975 by Bill Gates and Paul Allen, Microsoft develops, licenses and supports a broad range of software products, services and devices for consumers, enterprises and governments worldwide. Its operations span personal computing, productivity software, cloud infrastructure, enterprise applications, developer tools and gaming.

Microsoft’s product portfolio includes the Windows operating system and the Microsoft 365 suite of productivity and collaboration tools (Office apps, Outlook, Teams).

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Czech National Bank boosted its holdings in shares of Microsoft Corporation (NASDAQ:MSFT – Free Report) by 4.6% in the 2nd quarter, according to the company in its most recent disclosure with the Securities and Exchange Commission (SEC). The fund owned 2,114,417 shares of the software giant’s stock after purchasing an additional 92,079 shares during the period. Microsoft makes up approximately 4.3% of Czech National Bank’s holdings, making the stock its 3rd biggest position. Czech National Bank’s holdings in Microsoft were worth $788,720,000 as of its most recent SEC filing.

A number of other large investors have also recently added to or reduced their stakes in the business. Vanguard Group Inc. raised its position in shares of Microsoft by 2.3% during the fourth quarter. Vanguard Group Inc. now owns 717,942,580 shares of the software giant’s stock worth $347,211,391,000 after purchasing an additional 15,955,898 shares during the period. State Street Corp boosted its position in shares of Microsoft by 2.1% in the 4th quarter. State Street Corp now owns 306,150,608 shares of the software giant’s stock valued at $148,060,557,000 after purchasing an additional 6,388,930 shares during the period. Geode Capital Management LLC increased its stake in Microsoft by 1.1% in the 4th quarter. Geode Capital Management LLC now owns 182,618,400 shares of the software giant’s stock worth $88,056,019,000 after purchasing an additional 1,911,142 shares in the last quarter. Morgan Stanley increased its stake in Microsoft by 0.8% in the 4th quarter. Morgan Stanley now owns 121,220,561 shares of the software giant’s stock worth $58,624,690,000 after purchasing an additional 980,439 shares in the last quarter. Finally, Norges Bank acquired a new stake in Microsoft during the 4th quarter worth about $50,664,631,000. 71.13% of the stock is currently owned by institutional investors.

Wall Street Analyst Weigh In A number of research firms have commented on MSFT. Arete Research upped their price objective on shares of Microsoft from $730.00 to $870.00 and gave the company a “buy” rating in a research note on Tuesday, May 5th. Wedbush restated an “outperform” rating and set a $575.00 price target on shares of Microsoft in a report on Wednesday, May 13th. President Capital upped their price target on shares of Microsoft from $500.00 to $520.00 and gave the company a “buy” rating in a research report on Thursday, April 30th. The Goldman Sachs Group reissued a “buy” rating and set a $640.00 target price on shares of Microsoft in a research note on Thursday, July 30th. Finally, Barclays reduced their target price on Microsoft from $545.00 to $512.00 and set an “overweight” rating for the company in a report on Thursday, July 30th. Forty-two analysts have rated the stock with a Buy rating and five have issued a Hold rating to the stock. Based on data from MarketBeat.com, the stock has an average rating of “Moderate Buy” and an average target price of $560.27.

Read Our Latest Stock Report on MSFT Microsoft Stock Performance MSFT stock opened at $483.24 on Friday. The firm has a 50 day simple moving average of $419.61 and a 200 day simple moving average of $409.30. Microsoft Corporation has a 52 week low of $349.20 and a 52 week high of $553.72. The stock has a market cap of $3.59 trillion, a P/E ratio of 26.91, a P/E/G ratio of 1.56 and a beta of 1.11. The company has a debt-to-equity ratio of 0.07, a quick ratio of 1.22 and a current ratio of 1.23.

Microsoft (NASDAQ:MSFT – Get Free Report) last released its quarterly earnings data on Wednesday, July 29th. The software giant reported $4.74 earnings per share for the quarter, beating the consensus estimate of $4.24 by $0.50. Microsoft had a net margin of 40.31% and a return on equity of 31.98%. The firm had revenue of $90.01 billion for the quarter, compared to analyst estimates of $87.62 billion. During the same quarter in the prior year, the business earned $3.65 EPS. The company’s revenue for the quarter was up 17.7% compared to the same quarter last year. Research analysts anticipate that Microsoft Corporation will post 19.59 earnings per share for the current fiscal year.

Microsoft Dividend Announcement The company also recently disclosed a quarterly dividend, which will be paid on Thursday, September 10th. Investors of record on Thursday, August 20th will be given a dividend of $0.91 per share. The ex-dividend date of this dividend is Thursday, August 20th. This represents a $3.64 dividend on an annualized basis and a yield of 0.8%. Microsoft’s dividend payout ratio (DPR) is presently 20.27%.

Microsoft News Summary Here are the key news stories impacting Microsoft this week:

Positive Sentiment: Microsoft is reportedly preparing to launch its Maia 300 AI accelerator as soon as this fall and is discussing production with TSMC. Developing proprietary chips could reduce long-term reliance on Nvidia, improve supply-chain control, and support Microsoft’s expanding AI infrastructure. Microsoft’s Betting Big on Its Own AI Chips Positive Sentiment: Meta has reportedly become one of Microsoft’s largest Azure AI customers, spending hundreds of millions of dollars annually and consuming substantial computing capacity. The relationship reinforces evidence that enterprise demand is translating into Azure revenue. Meta Emerges as a Major Microsoft Azure AI Client Positive Sentiment: Microsoft raised its quarterly dividend to $0.91 per share, while Azure revenue reportedly surpassed $100 billion. Analysts and financial commentators also highlighted a roughly $678 billion backlog and continued strong demand for cloud and AI services. Microsoft Raises Dividend as AI Capital Spending Hits Record Levels Neutral Sentiment: Microsoft approved the Horizon 1 Texas data-center project involving IREN, potentially expanding capacity available for AI workloads. The development is strategically relevant, although the near-term financial benefit to Microsoft remains unclear. Microsoft Accepts Horizon 1 Negative Sentiment: Annual capital spending has climbed nearly 80% to about $115.9 billion, while free cash flow declined. Investors remain focused on whether AI revenue growth will generate adequate returns on this spending. Microsoft Spent $115.9 Billion on AI Negative Sentiment: TCI Management reportedly exited its Microsoft position and increased its Alphabet stake, adding a notable institutional-selling signal. Separately, commentary warned that Microsoft’s valuation depends on optimistic earnings forecasts, while higher bond yields could reduce the present value of future AI profits. TCI Exits Microsoft Insiders Place Their Bets In related news, EVP Takeshi Numoto sold 4,810 shares of Microsoft stock in a transaction on Tuesday, August 4th. The shares were sold at an average price of $496.48, for a total value of $2,388,068.80. Following the completion of the sale, the executive vice president owned 42,677 shares of the company’s stock, valued at approximately $21,188,276.96. The trade was a 10.13% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Also, CEO Judson Althoff sold 10,000 shares of the company’s stock in a transaction on Wednesday, August 5th. The stock was sold at an average price of $487.89, for a total transaction of $4,878,900.00. Following the completion of the sale, the chief executive officer owned 100,447 shares of the company’s stock, valued at $49,007,086.83. This represents a 9.05% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. In the last three months, insiders have sold 37,310 shares of company stock valued at $17,256,219. Insiders own 0.03% of the company’s stock.

Microsoft Profile (Free Report)

Microsoft Corporation is a global technology company headquartered in Redmond, Washington. Founded in 1975 by Bill Gates and Paul Allen, Microsoft develops, licenses and supports a broad range of software products, services and devices for consumers, enterprises and governments worldwide. Its operations span personal computing, productivity software, cloud infrastructure, enterprise applications, developer tools and gaming.

Microsoft’s product portfolio includes the Windows operating system and the Microsoft 365 suite of productivity and collaboration tools (Office apps, Outlook, Teams).

Read More Five stocks we like better than Microsoft 2 Biotech Stocks Shaping Up for Major Breakouts 3 Stocks Came Roaring Back—Now They’re Flashing Warning Signs 3 Beaten-Down Stocks That Haven’t Gotten the Message About the S&P 500’s Record Run Darden Restaurants Just Hit a 52-Week High–Is the Olive Garden Comeback Story Legit?

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When you're investing, you should always do so with a long-term mindset. People don't always want to hear this, but it's about gradually building wealth over time, not searching for a get-rich-quick scheme. It's easier said than done, but one of the best ways to do it is to hold onto great companies for the long haul.

One of my longest holdings is Microsoft (MSFT +0.43%), which I bought just over 10 years ago. It's been a lucrative rollercoaster ride, and despite its underperformance this year, it's a stock I haven't even considered selling.

My reason? It's the tech sector's Swiss Army knife.

Today's Change

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%) $

2.09

Current Price

$

483.24

Microsoft has its hands in many jars Few companies are as diversified as Microsoft, especially in the tech world. It has a strong case for being the most diversified tech company in the world, with tons of software and hardware, the world's second-largest cloud platform (Azure), Xbox, LinkedIn, and more.

Over a billion people use various Microsoft products and services, making it one of the most relied-upon tech companies in the world. That doesn't guarantee success, but it's one of the surest ways to accomplish sustained success, which Microsoft has shown us.

The number of users Microsoft has matters, but I like looking closer at how many of those users are other businesses. Microsoft is extremely important to the global business world. And when companies hit rough times, you can bet they'll cut many expenses before cutting enterprise software like Microsoft 365 (Excel, Teams, Outlook, etc.), Azure, or Windows.

Microsoft is a certified cash machine It's not all that matters in every situation, but I have always preferred cash machines. Microsoft easily checks that box.

In its fiscal year 2026 (ended June 30), it made $331.8 billion in revenue, $155.2 billion in operating income (profit from its core businesses), and $133.7 billion in net income. Year over year (YoY), those were up 18%, 21%, and 31%, respectively. Over the past decade, all three have grown impressively for a company of Microsoft's size.

MSFT Revenue (Annual) data by YCharts

The financial flexibility Microsoft has, given how much money it makes, allows it to pay dividends, buy back shares, and reinvest in the company to keep growing and keep up with the rapidly changing tech world. It has consistently done so, too.

Microsoft has increased its annual dividend for 21 straight years and spent $22.3 billion on share repurchases and $145 billion on capital expenditures in the past fiscal year.

AI spending is being put to good use There were many concerns at the beginning of this year about Microsoft's AI spending plans, but my stance was that, with as much money as Microsoft has and makes, it's better to overspend to ensure you keep up with the AI arms race than underspend and risk falling behind in what many are considering one of the most important tech revolutions since the internet.

Microsoft has spent a lot, no doubt ($41 billion in the latest quarter, up 70% YoY), but its recent earnings show a much clearer return on investment than investors may have expected earlier in the year. It's why its stock is up over 23% since reporting its latest earnings (as of Aug. 20).

Image source: The Motley Fool.

One of the best ways to measure the return on investment from AI spending is to look at cloud and Azure performance, since that's where businesses invest in AI tools. This fiscal year, Azure reached $100 billion in revenue for the first time, total Microsoft Cloud revenue increased 27% YoY to $214 billion, and its backlog grew 84% YoY to $678 billion.

How the AI boom eventually pans out remains to be seen, but one thing is for sure: Microsoft's business is built to thrive with or without the AI windfall. That's why it's one of my largest holdings, and why I don't plan to sell a single Microsoft share for the foreseeable future.

The iShares Core Dividend Growth ETF (DGRO +0.45%) passively tracks an index made up of U.S. companies with a history of dividend growth. However, that index, the Morningstar U.S. Dividend Growth Index, won't include a company unless it passes two strict tests:

It must have increased its dividend for at least the past five straight years. It must have a positive earnings forecast and a payout ratio below 75%. Additionally, the index excludes REITs and companies with a dividend yield in the top 10% of the dividends screened (after excluding REITs). Here's why these two strict tests matter.

Image source: Getty Images.

Shifting the dividend focus from current to future income Many of the largest and most popular dividend ETFs screen for dividend yield (e.g., SCHD and VYM). That's because their primary focus is on generating current income for investors. The iShares Core Dividend Growth ETF has a different focus. It aims to deliver dividend growth. Stocks with a high dividend payout ratio (often those with high yields) are at a greater risk of dividend reduction and underperformance. That's abundantly clear in the long-term data on companies by their dividend policies:

Dividend status

Average annual total return

Dividend Growers & Initiators

10.22%

Dividend Payers

9.20%

Equal-Weight S&P 500 Index

7.74%

No Change in Dividend Policy

6.87%

Dividend Cutters & Eliminators

-0.96%

Dividend Non-Payers

4.21%

Data source: Ned Davis Research and Hartford Funds. Note: Returns are based on S&P 500 members from 1973-2025.

The fund wants to ensure it tracks dividend growers, which is why it screens for companies with a history of growth and won't let companies with high payout levels in since they're at higher risk of maintaining their current payout, or worse, cutting or eliminating it. Those weaker companies would drag down the fund's returns and income over the long term.

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Putting the rules into practice The five-year dividend growth rule is a useful framework because these companies have demonstrated a genuine commitment to dividend growth. They have proven that they aren't just increasing their dividends when conditions allow, but have built a durable business that can deliver a sustainable, growing income stream to investors. It also screens out companies that don't have a proven dividend growth track record, such as those that just started paying dividends or had paused growth and recently resumed.

For example, the fund's top holding, Microsoft (MSFT +0.43%), has increased its dividend every year for more than two decades. That's a proven record of dividend durability and growth.

Meanwhile, the 75% or less dividend payout rule helps ensure dividend stability. It shows that the company is generating enough cash to cover its current payment while retaining some earnings to fund growth. It also gives the company a cushion to continue growing its dividend if it hits a rough patch.

Many of its holdings are well below that benchmark. For example, Microsoft generated nearly $183 billion in cash from operations during its 2026 fiscal year. That easily covered the $26.4 billion it paid in dividends. Microsoft's 14% payout ratio leaves it lots of room to grow.

Grow your dividend income with DGRO DGRO tracks an index with two strict tests for dividend stocks that help ensure its holdings can sustain and grow their dividend payments. While it yields less than other dividend funds (less than 2% over the last 12 months), the dividend should grow over time. That growth should also enhance the fund's total return, which has averaged 12.2% annualized since its inception in 2014.

Microsoft
MSFT +0.43% 96

, the enterprise-software, cloud and artificial-intelligence heavyweight, rose approximately 0.5% to $483.56 Friday afternoon as mega-cap technology stocks clawed back ground. The rebound was hardly explosive. The 30-year Treasury yield remained near a 19-year high, forcing investors to demand more from companies priced for years of future growth.

Microsoft is delivering. Fiscal fourth-quarter revenue surged 18% to $90 billion, Azure revenue rocketed 43% and commercial remaining performance obligations exploded 84% to $678 billion. Free cash flow hit $19.6 billion and beat expectations, but it still dropped 23% year over year. The AI machine is growing fast. It is also devouring cash.

That $678 billion backlog is Microsoft's weapon. The company already has the demand; now it must build enough computing capacity to collect the money. Higher yields punish distant profits, but Microsoft can bankroll the expansion internally while weaker rivals reach for expensive debt. The valuation picture adds another twist: the shares trade 16.32% below their $577.84 GF Value™, suggesting Wall Street sees the spending surge but may be underpricing the cash still waiting in the pipeline.

Check the Warning Signs for

MSFT

now!

Microsoft (MSFT +0.40%) has had an interesting 2026. It started off the year on a poor note, dropping after it reported results for its fiscal 2026 second quarter (which ended Dec. 31). After further ups and downs through the year, it took the delivery of strong fiscal Q4 results on July 29 to get the stock to rally convincingly, but it's now basically back to flat for the year. With the S&P 500 (^GSPC +0.53%) up by more than 12% so far, Microsoft has been a poor investment in 2026.

However, is now the perfect time to load up on shares before an even bigger rally can occur? Let's take a look and see if Microsoft is worth buying below the $500 per share threshold.

Image source: Getty Images.

Microsoft is trading at a lower-than-usual forward P/E Microsoft is one of the major players in the AI realm, and it's profiting from the trend in several ways. The first way is through its Copilot tool, which incorporates AI features into all of its software products. Copilot now has 30 million paid seats -- a figure that will likely continue rising as the tool becomes more popular.

Today's Change

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0.40

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1.94

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483.09

Another way Microsoft is thriving from the AI build-out is via its cloud computing division, Azure. Azure is one of the largest cloud computing providers in the world, and makes money by building out computing capacity, then renting it out to various clients. Azure's revenue grew at a 43% pace last quarter, making it Microsoft's fastest-growing division.

But does all of this add up to a stock that's worth buying now?

If you look at how Microsoft has been valued on a forward price-to-earnings (P/E) ratio basis, it's not as cheap today as it was prior to the fiscal Q4 report. However, it's still cheaper than it has been over most of the past two years.

MSFT PE Ratio (Forward) data by YCharts

This makes the stock look like a somewhat good deal, but is it better than its peers? I'd argue that it's not.

Microsoft is trading at a more expensive premium than Nvidia (NVDA -0.86%), Alphabet (GOOG +1.40%) (GOOGL +1.46%), or Amazon (AMZN -0.17%), yet it's growing at a slower pace than any of them.

MSFT PE Ratio (Forward) data by YCharts

From a growth standpoint, everyone is chasing Nvidia, but Microsoft still lags behind Amazon and Alphabet.

MSFT Revenue (Quarterly YoY Growth) data by YCharts.

So, is Microsoft a bad investment? I don't think so. I think it's reasonably valued right now. However, there are better deals available in the market, and I think investors would be better advised to move their money into those other three tech stocks, as they all have far more upside potential than Microsoft.

Keithen Drury has positions in Alphabet, Amazon, Microsoft, and Nvidia. The Motley Fool has positions in and recommends Alphabet, Amazon, Microsoft, and Nvidia. The Motley Fool has a disclosure policy.

Investors looking for stocks in the Computer - Software sector might want to consider either Progress Software (PRGS) or Microsoft (MSFT). But which of these two companies is the best option for those looking for undervalued stocks?

Microsoft shareholders just cashed a bigger check. On August 20, 2026, Microsoft (NASDAQ:MSFT | MSFT Price Prediction) went ex-dividend at $0.91 per share, up from $0.83 a year earlier. At $481.15, that annualizes to a yield south of 1%. It is the sort of raise long-term holders have come to expect. What is unusual is what sits on the other side of the ledger.

Dividend Raise Collides With a $115.9 Billion Buildout [chart:MSFT]

For the fiscal year ended June 30, Microsoft spent $115.948 billion on capital expenditures, a 79.62% jump aimed at cloud and AI infrastructure. Net income rose 31.34% to $133.749 billion. Free cash flow, however, fell 6.46% to $66.987 billion. Microsoft returned $26.445 billion in dividends and repurchased $22.271 billion in stock. In fiscal 2025, capex was $64.551 billion against $24.082 billion in dividends. Capex is now growing roughly eight times faster than the payout.

Fiscal Q4 alone captures the strain: $35.802 billion of capex, up 109.63%, with quarterly free cash flow down 23.19% to $19.639 billion.

What Shareholders Actually Received The tangible returns are real. Azure surpassed $100 billion in annual revenue, up 41%. Microsoft 365 Copilot reached over 30 million paid seats. Commercial remaining performance obligations hit $678 billion, up 84%, a backlog that dwarfs annual revenue. CEO Satya Nadella framed the payoff: “This year, Azure revenue surpassed $100 billion for the first time, and Microsoft 365 Copilot reached over 30 million paid seats.”

Price action tells a more ambivalent story. MSFT is down 3.91% over the past year from $500.75, though it has snapped back 21.2% in the past month off a July low of $397. Year to date, shares are essentially flat at 0.12%. The forward P/E of 24 and analyst target of $569.56 suggest Wall Street still believes, with 40 buy ratings and 14 strong buys against three holds.

Peer Context and the September Test For scale, Alphabet (NASDAQ:GOOGL) spent $91.447 billion on capex and paid $10.049 billion in dividends in calendar 2025. Microsoft outspent that and returned more than double the cash. All of that spending has to be powered, cooled, and networked by somebody, and we pulled together seven suppliers riding the buildout in a free AI infrastructure report.

CFO Amy Hood signaled the intensity will not ease. She told analysts the calendar 2026 outlook, adjusted for a lease-accounting shift, moves to approximately $175 billion, adding: “We expect FY27 capital expenditures will grow year over year, given demand signals across our portfolio,” and “We expect to remain free cash flow positive in FY27.”

Microsoft has historically declared its annual dividend increase in September. The September 15, 2025 declaration lifted the quarterly rate to $0.91. The next raise announcement is weeks away, and it will be the clearest signal yet of whether the AI buildout is squeezing the payout, or whether Nadella can keep funding both.

Contact [email protected] for any questions or corrections.

Baron Wealth Management LLC lifted its holdings in Microsoft Corporation (NASDAQ:MSFT – Free Report) by 19.7% during the 2nd quarter, according to its most recent 13F filing with the Securities and Exchange Commission (SEC). The fund owned 10,478 shares of the software giant’s stock after purchasing an additional 1,725 shares during the period. Microsoft comprises 1.0% of Baron Wealth Management LLC’s holdings, making the stock its 14th biggest holding. Baron Wealth Management LLC’s holdings in Microsoft were worth $3,908,000 as of its most recent SEC filing.

A number of other hedge funds have also modified their holdings of the stock. Norges Bank bought a new stake in shares of Microsoft in the fourth quarter valued at about $50,664,631,000. Auto Owners Insurance Co grew its stake in Microsoft by 56,160.8% during the fourth quarter. Auto Owners Insurance Co now owns 60,116,384 shares of the software giant’s stock worth $29,073,486,000 after buying an additional 60,009,531 shares during the last quarter. Nuveen LLC bought a new position in Microsoft in the 1st quarter valued at $18,733,827,000. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC raised its holdings in shares of Microsoft by 500.0% in the third quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 59,543,261 shares of the software giant’s stock valued at $30,840,432,000 after buying an additional 49,618,571 shares during the last quarter. Finally, Laurel Wealth Advisors LLC lifted its position in shares of Microsoft by 49,640.3% during the second quarter. Laurel Wealth Advisors LLC now owns 29,967,038 shares of the software giant’s stock worth $14,905,904,000 after purchasing an additional 29,906,791 shares in the last quarter. 71.13% of the stock is currently owned by institutional investors and hedge funds.

Microsoft Trading Down 0.7% Shares of NASDAQ MSFT opened at $481.15 on Friday. The stock has a market cap of $3.57 trillion, a P/E ratio of 26.79, a price-to-earnings-growth ratio of 1.56 and a beta of 1.11. Microsoft Corporation has a 52-week low of $349.20 and a 52-week high of $553.72. The firm has a 50 day moving average price of $417.76 and a two-hundred day moving average price of $408.78. The company has a debt-to-equity ratio of 0.07, a quick ratio of 1.22 and a current ratio of 1.23.

Microsoft (NASDAQ:MSFT – Get Free Report) last issued its quarterly earnings results on Wednesday, July 29th. The software giant reported $4.74 earnings per share (EPS) for the quarter, topping analysts’ consensus estimates of $4.24 by $0.50. The firm had revenue of $90.01 billion for the quarter, compared to the consensus estimate of $87.62 billion. Microsoft had a net margin of 40.31% and a return on equity of 31.98%. The company’s revenue for the quarter was up 17.7% on a year-over-year basis. During the same quarter in the previous year, the company earned $3.65 EPS. As a group, equities analysts forecast that Microsoft Corporation will post 19.59 EPS for the current year. Microsoft Announces Dividend The business also recently disclosed a quarterly dividend, which will be paid on Thursday, September 10th. Shareholders of record on Thursday, August 20th will be issued a dividend of $0.91 per share. This represents a $3.64 dividend on an annualized basis and a yield of 0.8%. The ex-dividend date of this dividend is Thursday, August 20th. Microsoft’s payout ratio is currently 20.27%.

Analyst Upgrades and Downgrades A number of research firms have recently weighed in on MSFT. Guggenheim reissued a “buy” rating and issued a $586.00 price target on shares of Microsoft in a research note on Monday, July 27th. Truist Financial reaffirmed a “buy” rating and issued a $575.00 price objective on shares of Microsoft in a research report on Wednesday, July 22nd. Mizuho reduced their price target on Microsoft from $515.00 to $490.00 and set an “outperform” rating for the company in a research report on Wednesday, July 15th. Morgan Stanley reaffirmed an “overweight” rating on shares of Microsoft in a research report on Thursday, July 30th. Finally, Phillip Securities lowered shares of Microsoft from a “strong-buy” rating to a “moderate buy” rating in a research report on Monday, August 3rd. Forty-two equities research analysts have rated the stock with a Buy rating and five have given a Hold rating to the company. Based on data from MarketBeat, Microsoft has a consensus rating of “Moderate Buy” and a consensus target price of $560.27.

Check Out Our Latest Report on Microsoft

Insider Activity at Microsoft In other news, EVP Takeshi Numoto sold 4,810 shares of the business’s stock in a transaction that occurred 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 transaction, the executive vice president owned 42,677 shares in the company, valued at $21,188,276.96. The trade was a 10.13% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, CEO Judson Althoff sold 10,000 shares of Microsoft stock in a transaction on Wednesday, August 5th. The stock was sold at an average price of $487.89, for a total value of $4,878,900.00. Following the sale, the chief executive officer owned 100,447 shares in the company, valued at $49,007,086.83. This trade represents a 9.05% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Over the last three months, insiders sold 37,310 shares of company stock valued at $17,256,219. Company insiders own 0.03% of the company’s stock.

Microsoft News Roundup Here are the key news stories impacting Microsoft this week:

Positive Sentiment: Azure demand remains a major support. Microsoft’s reported $678 billion backlog of contracted cloud commitments provides visibility for future revenue and helps defend the company’s aggressive AI infrastructure spending. Microsoft Stock Rises as $678 Billion Backlog Supports AI Spending Positive Sentiment: Meta is becoming a significant Azure AI customer. Meta reportedly spends hundreds of millions of dollars annually on Azure and consumes large volumes of AI tokens, reinforcing demand for Microsoft’s cloud and AI services. Meta Platforms Emerges as a Major Microsoft Azure AI Client Positive Sentiment: Microsoft continues investing in AI capabilities. The company is increasing fiscal 2027 capital expenditures to expand infrastructure, while internally developed AI chips could improve efficiency and margins over time. Its latest quarterly results also showed strong earnings and 17.7% year-over-year revenue growth. Neutral Sentiment: Microsoft is hiring AI-capable legal talent and reportedly offering compensation of up to $279,000 for a legal engineer. The move highlights the company’s effort to integrate AI into commercial and compliance operations but is unlikely to materially affect near-term results. Microsoft Will Pay Up to $279K for a Lawyer Who Can Build AI Negative Sentiment: Higher yields are pressuring long-duration AI valuations. Rising interest rates reduce the present value of projected future AI profits, contributing to market questions despite Microsoft’s backlog and operating strength. Microsoft Slips as 4.68% Yield Tests Its $678 Billion Backlog Negative Sentiment: Technology stocks broadly declined Thursday afternoon, adding sector-driven pressure to MSFT. Investors are also monitoring concerns that large AI companies buying services from one another could create circular demand signals. Negative Sentiment: Microsoft faces geopolitical and execution risks. China is accelerating its move away from Windows, while continued AI capital spending raises questions about returns on investment. Recent insider activity also shows executive selling without reported purchases, a modest negative sentiment signal. About Microsoft (Free Report)

Microsoft Corporation is a global technology company headquartered in Redmond, Washington. Founded in 1975 by Bill Gates and Paul Allen, Microsoft develops, licenses and supports a broad range of software products, services and devices for consumers, enterprises and governments worldwide. Its operations span personal computing, productivity software, cloud infrastructure, enterprise applications, developer tools and gaming.

Microsoft’s product portfolio includes the Windows operating system and the Microsoft 365 suite of productivity and collaboration tools (Office apps, Outlook, Teams).

See Also Five stocks we like better than Microsoft 3 Energy Stocks Raising Dividends as the Sector Surges 5 Reasons the S&P 500 Could Keep Rallying Through Year-End Walmart’s Post-Earnings Drop Could Be a Buying Opportunity The Trade Desk’s Earnings Miss Raises a Bigger Question About Its AI Future

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Canandaigua National Bank & Trust Co. acquired a new position in Microsoft Corporation (NASDAQ:MSFT – Free Report) in the second quarter, according to the company in its most recent filing with the Securities & Exchange Commission. The institutional investor acquired 78,873 shares of the software giant’s stock, valued at approximately $29,421,000. Microsoft accounts for about 2.5% of Canandaigua National Bank & Trust Co.’s portfolio, making the stock its 7th largest holding.

Several other hedge funds have also modified their holdings of the company. Longfellow Investment Management Co. LLC increased its stake in shares of Microsoft by 51.3% during the second quarter. Longfellow Investment Management Co. LLC now owns 59 shares of the software giant’s stock worth $29,000 after purchasing an additional 20 shares in the last quarter. Bernzott Capital Advisors purchased a new position in Microsoft in the 4th quarter valued at about $34,000. Timmons Wealth Management LLC purchased a new position in Microsoft in the 4th quarter valued at about $36,000. Fairway Wealth LLC boosted its holdings in Microsoft by 287.0% in the 4th quarter. Fairway Wealth LLC now owns 89 shares of the software giant’s stock worth $43,000 after buying an additional 66 shares during the last quarter. Finally, LSV Asset Management purchased a new stake in Microsoft during the 4th quarter worth approximately $44,000. 71.13% of the stock is owned by hedge funds and other institutional investors.

Trending Headlines about Microsoft Here are the key news stories impacting Microsoft this week:

Positive Sentiment: Azure demand remains a major support. Microsoft’s reported $678 billion backlog of contracted cloud commitments provides visibility for future revenue and helps defend the company’s aggressive AI infrastructure spending. Microsoft Stock Rises as $678 Billion Backlog Supports AI Spending Positive Sentiment: Meta is becoming a significant Azure AI customer. Meta reportedly spends hundreds of millions of dollars annually on Azure and consumes large volumes of AI tokens, reinforcing demand for Microsoft’s cloud and AI services. Meta Platforms Emerges as a Major Microsoft Azure AI Client Positive Sentiment: Microsoft continues investing in AI capabilities. The company is increasing fiscal 2027 capital expenditures to expand infrastructure, while internally developed AI chips could improve efficiency and margins over time. Its latest quarterly results also showed strong earnings and 17.7% year-over-year revenue growth. Neutral Sentiment: Microsoft is hiring AI-capable legal talent and reportedly offering compensation of up to $279,000 for a legal engineer. The move highlights the company’s effort to integrate AI into commercial and compliance operations but is unlikely to materially affect near-term results. Microsoft Will Pay Up to $279K for a Lawyer Who Can Build AI Negative Sentiment: Higher yields are pressuring long-duration AI valuations. Rising interest rates reduce the present value of projected future AI profits, contributing to market questions despite Microsoft’s backlog and operating strength. Microsoft Slips as 4.68% Yield Tests Its $678 Billion Backlog Negative Sentiment: Technology stocks broadly declined Thursday afternoon, adding sector-driven pressure to MSFT. Investors are also monitoring concerns that large AI companies buying services from one another could create circular demand signals. Negative Sentiment: Microsoft faces geopolitical and execution risks. China is accelerating its move away from Windows, while continued AI capital spending raises questions about returns on investment. Recent insider activity also shows executive selling without reported purchases, a modest negative sentiment signal. Insiders Place Their Bets In related news, EVP Takeshi Numoto sold 4,810 shares of the company’s stock in a transaction on Tuesday, August 4th. The shares were sold at an average price of $496.48, for a total value of $2,388,068.80. Following the completion of the sale, the executive vice president owned 42,677 shares in the company, valued at $21,188,276.96. This represents a 10.13% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through the SEC website. Also, CEO Judson Althoff sold 10,000 shares of the firm’s stock in a transaction on Wednesday, August 5th. The stock was sold at an average price of $487.89, for a total transaction of $4,878,900.00. Following the transaction, the chief executive officer directly owned 100,447 shares in the company, valued at $49,007,086.83. The trade was a 9.05% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Over the last 90 days, insiders sold 37,310 shares of company stock worth $17,256,219. 0.03% of the stock is owned by insiders. Analysts Set New Price Targets A number of research analysts have weighed in on MSFT shares. Oppenheimer restated an “outperform” rating and issued a $515.00 price objective on shares of Microsoft in a report on Wednesday, July 22nd. BMO Capital Markets increased their target price on shares of Microsoft from $500.00 to $515.00 and gave the company an “outperform” rating in a research report on Thursday, July 30th. The Goldman Sachs Group reissued a “buy” rating and issued a $640.00 price target on shares of Microsoft in a research note on Thursday, July 30th. Evercore set a $528.00 price target on shares of Microsoft in a research report on Thursday, July 30th. Finally, Deutsche Bank Aktiengesellschaft reaffirmed a “buy” rating on shares of Microsoft in a research note on Monday, July 20th. Forty-two equities research analysts have rated the stock with a Buy rating and five have given a Hold rating to the stock. According to MarketBeat, Microsoft has a consensus rating of “Moderate Buy” and an average target price of $560.27.

Get Our Latest Analysis on Microsoft

Microsoft Trading Down 0.7% NASDAQ MSFT opened at $481.15 on Friday. The company has a debt-to-equity ratio of 0.07, a current ratio of 1.23 and a quick ratio of 1.22. The stock has a market capitalization of $3.57 trillion, a P/E ratio of 26.79, a PEG ratio of 1.56 and a beta of 1.11. The firm’s 50-day moving average is $417.76 and its two-hundred day moving average is $408.78. Microsoft Corporation has a 12 month low of $349.20 and a 12 month high of $553.72.

Microsoft (NASDAQ:MSFT – Get Free Report) last posted its quarterly earnings data on Wednesday, July 29th. The software giant reported $4.74 earnings per share (EPS) for the quarter, beating the consensus estimate of $4.24 by $0.50. The firm had revenue of $90.01 billion for the quarter, compared to the consensus estimate of $87.62 billion. Microsoft had a return on equity of 31.98% and a net margin of 40.31%.The company’s quarterly revenue was up 17.7% compared to the same quarter last year. During the same quarter in the previous year, the business earned $3.65 EPS. On average, sell-side analysts anticipate that Microsoft Corporation will post 19.59 earnings per share for the current year.

Microsoft Dividend Announcement The firm also recently announced a quarterly dividend, which will be paid on Thursday, September 10th. Investors of record on Thursday, August 20th will be issued a $0.91 dividend. This represents a $3.64 annualized dividend and a yield of 0.8%. The ex-dividend date of this dividend is Thursday, August 20th. Microsoft’s dividend payout ratio is 20.27%.

Microsoft Profile (Free Report)

Microsoft Corporation is a global technology company headquartered in Redmond, Washington. Founded in 1975 by Bill Gates and Paul Allen, Microsoft develops, licenses and supports a broad range of software products, services and devices for consumers, enterprises and governments worldwide. Its operations span personal computing, productivity software, cloud infrastructure, enterprise applications, developer tools and gaming.

Microsoft’s product portfolio includes the Windows operating system and the Microsoft 365 suite of productivity and collaboration tools (Office apps, Outlook, Teams).

Further Reading Five stocks we like better than Microsoft 3 Energy Stocks Raising Dividends as the Sector Surges 5 Reasons the S&P 500 Could Keep Rallying Through Year-End Walmart’s Post-Earnings Drop Could Be a Buying Opportunity The Trade Desk’s Earnings Miss Raises a Bigger Question About Its AI Future Want to see what other hedge funds are holding MSFT? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Microsoft Corporation (NASDAQ:MSFT – Free Report).

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Bill Ackman is one of the world's most renowned investors. The billionaire hedge fund manager runs a very concentrated portfolio of fewer than 15 stocks, so when he makes moves, investors take notice. While he added new positions in credit card networks Visa and Mastercard, financial intelligence company S&P Global, and video streamer Netflix, those weren't his only notable moves.

During the quarter, he made some big moves with stocks of hyperscalers (owners of large data centers). Ackman finished selling off his remaining small Alphabet (GOOGL -1.18%) (GOOG -1.02%) stake, while slashing his position in Amazon (AMZN -2.15%) by 25%. He also added to his positions in Microsoft (MSFT -0.47%) and Meta Platforms (META -0.04%).

Let's take a closer look at these hyperscaler stocks to see if investors should follow suit.

Microsoft

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-2.25

Current Price

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481.15

Microsoft is Ackman's third-largest holding, and he upped his position by nearly 10% in the second quarter. It's easy to see why the legendary investor likes the stock. Even after a recent jump, the stock has done very little over the past year despite continued strong operational performance.

The worry is that AI will disrupt its core software business, while some investors have questioned the economics of AI-focused cloud computing in general and Microsoft's heavy ties to OpenAI. However, Microsoft's software is deeply embedded in enterprises, and the increasing adoption of its AI copilots shows that the company is becoming an AI winner.

Meanwhile, its Azure cloud computing unit continues to put up outstanding growth and has a huge backlog. This is a stock to own for the long term.

Meta Platforms

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-0.04

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-0.20

Current Price

$

545.83

Meta is a top growth stock trading at a very attractive valuation, with a forward price-to-earnings (P/E) of just 15 times 2027 analyst estimates. While investors have frowned at its AI infrastructure spending, few companies have been as good at employing AI to drive growth in their core business as Meta.

Ackman likes the company for its great flywheel business, where continued AI improvements to its algorithms lead to users staying on its apps longer and advertisers being better able to connect with them. This is leading to both increasing ad impressions and increasing prices, which is driving strong growth for the company. Meanwhile, Meta has started to make some impressive strides with the release of its recent AI models.

This is a stock to buy while it remains cheap.

Amazon

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(

-2.15

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-5.73

Current Price

$

260.11

While Ackman cut his stake in Amazon by a quarter, it remains his fifth-largest position. However, this is not a stock I'd personally be looking to trim. The company is currently firing on all cylinders, and the stock remains relatively cheap both from a historical standpoint and compared to some of its brick-and-mortar retail peers, like Costco Wholesale and Walmart.

The company's e-commerce business just continues to deliver solid revenue growth. More impressively, it's seeing tremendous operating leverage from its internal investments in AI and robotics, as well as its high-margin sponsored ad business. At the same time, its cloud computing business is seeing accelerating revenue growth, backed by partnerships with Anthropic and OpenAI. Amazon is spending aggressively to increase capacity, and its custom chip business helps give it a cost advantage.

The company is getting a strong locked-in return on these investments, and management thinks Amazon Web Services can become a $1 trillion revenue business in the future. This is a stock I'd continue to buy at current levels.

Image source: Getty Images.

Alphabet After he cut most of his position in the first quarter, it was not surprising to see Ackman completely exit Alphabet in Q2. However, this is a stock I really like.

The company is the most complete AI player, and it has several big advantages. This includes its custom Tensor Processing Units (TPUs), which are the most powerful custom AI chips out there, giving it a big cost advantage for inference and training its AI models. It also has a huge distribution edge through its ownership of Chrome, Android, and its search revenue-sharing deal with Apple, while its powerful global ad network is helping it monetize AI better with consumers than most AI model companies.

Alphabet is well-positioned to be an AI leader over the long haul, and it's a stock I'd want to continue to own.

Geoffrey Seiler has positions in Alphabet, Amazon, and Meta Platforms. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Costco Wholesale, Mastercard, Meta Platforms, Microsoft, Netflix, S&P Global, Visa, and Walmart. The Motley Fool has a disclosure policy.

For new and old investors, taking full advantage of the stock market and investing with confidence are common goals. Zacks Premium provides lots of different ways to do both.

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Stock to Watch: Microsoft (MSFT - Free Report) Redmond, WA-based Microsoft Corporation is one of the largest broad-based technology providers in the world. The company holds the leading position in the PC software market with its Windows operating system. 

MSFT is a #3 (Hold) on the Zacks Rank, with a VGM Score of B.

Additionally, the company could be a top pick for growth investors. MSFT has a Growth Style Score of B, forecasting year-over-year earnings growth of 9.1% for the current fiscal year.

13 analysts revised their earnings estimate higher in the last 60 days for fiscal 2027, while the Zacks Consensus Estimate has increased $0.32 to $19.59 per share. MSFT also boasts an average earnings surprise of +9.3%.

With a solid Zacks Rank and top-tier Growth and VGM Style Scores, MSFT should be on investors' short list.

Meta Platforms Inc. (META, Financials), the social media giant, Alphabet Inc. (GOOGL, Financials), the parent company of Google, and Microsoft Corp. (MSFT, Fina

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Microsoft CEO Satya Nadella. Sven Hoppe/picture alliance via Getty Images Microsoft appears to want to put its legal department on AI steroids.

The company is seeking a principal legal engineer to help shape how its lawyers use artificial intelligence. The hire will build agents, sharpen prompts, and train attorneys in Microsoft's Customer & Partner Solutions group, which supports the company's commercial business, according to a job description posted on LinkedIn this week.

A Microsoft spokesperson did not respond to a request to comment.

For decades, lawyers were the corporate world's tech holdouts, wary of tools that could get even a single detail wrong. Artificial intelligence is starting to change that. Clients are pushing law firms to use tools such as Harvey and Claude for Legal to get work done faster and, ideally, charge less for it.

That same pressure is moving in-house. Legal teams are betting that software can help them edit contracts and write policies, allowing them to do more early work themselves and send outside counsel matters that are further along. That could shrink their legal bills.

Microsoft is betting big on AI. Company insiders have serious doubts.

Microsoft could want someone on the inside steering that effort.

"This is a role for a builder. You will ship real capability rather than advise from the sidelines, partner directly with engineering, and stay close enough to attorneys and paralegals to design with them rather than for them," the company wrote in the job description.

Microsoft has the advantage of building some of these tools itself. In a blog post, the company said its lawyers use Copilot, its flagship assistant, to speed up routine work. One use case is contract review. Copilot can compare a draft with similar agreements, flag issues, and suggest edits that fit with the company's policies, the company wrote.

Microsoft has also begun rolling out Harvey across Corporate, External, and Legal Affairs, its broader legal organization.

Microsoft's job posting is one of the clearest signs yet that the legal engineer role is catching on inside corporate legal departments.

The job has already come into vogue at startups selling software to law firms. Legal engineers tend to be former lawyers with technical chops. They sit close to customers and help shape the company's software around the way lawyers actually work.

Last month, Palantir also posted a job description for an embedded legal engineer. The hire will work directly with Palantir's lawyers to "transform high-touch, manual workflows into scalable, automated solutions," per the job description.

For its role, Microsoft is seeking someone with a law degree and at least seven years of experience as a practicing attorney. "Hands-on experience with AI legal tools such as Harvey or Copilot" is preferred, the company wrote. Base pay ranges from $147,000 to $278,900 a year.

Read next

Melia Robinson You're currently following this author! Want to unfollow? Unsubscribe via the link in your email.

Melia Robinson is a reporter at Business Insider covering how lawyers are changing the way they work and bill in the age of artificial intelligence — and about the tech companies racing to serve them.Melia first joined Business Insider in 2013. She lives in New York City.

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Microsoft
MSFT +0.53% 96

, the enterprise-software, cloud and artificial-intelligence giant, gained approximately 0.6% to $484.30 Wednesday morning as falling Treasury yields pulled buyers back into mega-cap technology. But forget the small bounce for a second. The bigger Microsoft story is sitting underneath the stock: Azure is ripping higher, AI demand is pouring in, and customers have already committed hundreds of billions of dollars to Microsoft's ecosystem.

The numbers are huge. Microsoft reported quarterly revenue of $90 billion, up 18%, while operating income jumped 18% to $40.6 billion. Azure and other cloud-services revenue surged 43%, annual Azure revenue blasted through $100 billion for the first time, and commercial remaining performance obligations exploded 84% to $678 billion. That $678 billion is the number that matters. Microsoft is not spending aggressively on AI infrastructure while waiting for customers to show up. A massive wave of contracted business is already waiting to become revenue.

And the valuation picture just got more interesting. Microsoft traded at $485.71 on Aug. 19 versus a GF Value™ estimate of $577.29, leaving the stock 15.86% below GF Value™. That does not automatically make Microsoft cheap, but the gap stands out when Azure is growing 43% and the commercial backlog is sitting at $678 billion. Now comes the hard part: execution. Microsoft must build enough AI capacity to feed that demand without letting data-center spending, depreciation and infrastructure costs eat away at the economics. If it can nail that equation, Wednesday's 0.6% rebound could be the least interesting number in the Microsoft story.

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Basecamp Wealth Advisors LLC trimmed its holdings in shares of Microsoft Corporation (NASDAQ:MSFT – Free Report) by 3.7% during the first quarter, according to its most recent 13F filing with the SEC. The institutional investor owned 46,665 shares of the software giant’s stock after selling 1,795 shares during the period. Microsoft makes up 3.6% of Basecamp Wealth Advisors LLC’s investment portfolio, making the stock its 3rd largest holding. Basecamp Wealth Advisors LLC’s holdings in Microsoft were worth $17,274,000 as of its most recent SEC filing.

Other large investors also recently modified their holdings of the company. WFA Asset Management Corp lifted its stake in Microsoft by 27.0% during the 1st quarter. WFA Asset Management Corp now owns 1,016 shares of the software giant’s stock valued at $427,000 after acquiring an additional 216 shares in the last quarter. Ironwood Wealth Management LLC. lifted its position in shares of Microsoft by 0.3% during the second quarter. Ironwood Wealth Management LLC. now owns 12,658 shares of the software giant’s stock valued at $5,658,000 after purchasing an additional 38 shares in the last quarter. Discipline Wealth Solutions LLC boosted its holdings in Microsoft by 410.4% during the third quarter. Discipline Wealth Solutions LLC now owns 2,659 shares of the software giant’s stock worth $1,144,000 after purchasing an additional 2,138 shares during the last quarter. Wealth Group Ltd. grew its position in Microsoft by 1.2% in the 4th quarter. Wealth Group Ltd. now owns 2,374 shares of the software giant’s stock worth $1,000,000 after purchasing an additional 28 shares in the last quarter. Finally, Eagle Capital Management LLC increased its stake in Microsoft by 0.4% in the 4th quarter. Eagle Capital Management LLC now owns 23,097 shares of the software giant’s stock valued at $9,735,000 after buying an additional 96 shares during the last quarter. Institutional investors and hedge funds own 71.13% of the company’s stock.

Analysts Set New Price Targets A number of equities analysts have recently weighed in on MSFT shares. Guggenheim restated a “buy” rating and issued a $586.00 target price on shares of Microsoft in a research note on Monday, July 27th. Scotiabank reiterated an “outperform” rating and set a $510.00 price target on shares of Microsoft in a report on Thursday, July 30th. Truist Financial restated a “buy” rating and issued a $575.00 price objective on shares of Microsoft in a research note on Wednesday, July 22nd. Tigress Financial raised their target price on Microsoft from $680.00 to $690.00 and gave the company a “buy” rating in a research report on Wednesday, August 5th. Finally, China Renaissance lowered their target price on Microsoft from $630.00 to $550.00 and set a “buy” rating on the stock in a research note on Monday, May 4th. Forty-two equities research analysts have rated the stock with a Buy rating and five have given a Hold rating to the stock. According to MarketBeat, Microsoft has a consensus rating of “Moderate Buy” and an average price target of $560.27.

Read Our Latest Stock Analysis on MSFT Insider Transactions at Microsoft In other news, EVP Takeshi Numoto sold 4,810 shares of Microsoft stock in a transaction dated Tuesday, August 4th. The shares were sold at an average price of $496.48, for a total value of $2,388,068.80. Following the completion of the transaction, the executive vice president 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. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available at the SEC website. Also, CEO Judson Althoff sold 15,500 shares of the business’s stock in a transaction that occurred on Monday, June 1st. The shares were sold at an average price of $460.99, for a total transaction of $7,145,345.00. Following the completion of the sale, the chief executive officer directly owned 110,477 shares in the company, valued at approximately $50,928,792.23. This trade represents a 12.30% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders have sold 37,310 shares of company stock valued at $17,256,219 in the last quarter. Company insiders own 0.03% of the company’s stock.

Microsoft Stock Performance Shares of MSFT opened at $481.63 on Wednesday. Microsoft Corporation has a 1 year low of $349.20 and a 1 year high of $553.72. The company has a debt-to-equity ratio of 0.07, a current ratio of 1.23 and a quick ratio of 1.22. The stock’s fifty day moving average price is $414.21 and its two-hundred day moving average price is $408.06. The firm has a market cap of $3.58 trillion, a PE ratio of 26.82, a PEG ratio of 1.59 and a beta of 1.10.

Microsoft (NASDAQ:MSFT – Get Free Report) last posted its quarterly earnings results on Wednesday, July 29th. The software giant reported $4.74 earnings per share for the quarter, topping the consensus estimate of $4.24 by $0.50. Microsoft had a return on equity of 31.98% and a net margin of 40.31%.The company had revenue of $90.01 billion during the quarter, compared to the consensus estimate of $87.62 billion. During the same quarter in the prior year, the company earned $3.65 EPS. The firm’s quarterly revenue was up 17.7% compared to the same quarter last year. On average, equities research analysts forecast that Microsoft Corporation will post 19.59 EPS for the current year.

Microsoft Dividend Announcement The firm also recently announced a quarterly dividend, which will be paid on Thursday, September 10th. Shareholders of record on Thursday, August 20th will be given a dividend of $0.91 per share. This represents a $3.64 dividend on an annualized basis and a yield of 0.8%. The ex-dividend date is Thursday, August 20th. Microsoft’s dividend payout ratio (DPR) is currently 20.27%.

Microsoft News Summary Here are the key news stories impacting Microsoft this week:

Positive Sentiment: Azure and Copilot momentum remain the primary catalysts. Azure reportedly surpassed $100 billion in annual revenue, while Microsoft 365 Copilot exceeded 30 million paid seats. Those milestones reinforce the view that Microsoft is beginning to monetize its AI investments at scale. Price Prediction: One Number Could Decide How High Microsoft Goes in 2027 Positive Sentiment: Strong quarterly results continue to support the bull case. Microsoft’s latest report showed earnings per share of $4.74 versus a $4.24 consensus estimate and revenue of $90.01 billion, up 17.7% year over year. Cloud computing and AI helped drive roughly 30% profit growth. These Telltale Signs Cue Microsoft Investors Despite Earnings Surge Positive Sentiment: Enterprise adoption and partnerships are broadening demand. Swiss companies are increasing their use of Microsoft’s AI and cloud products, with governance and data sovereignty controls supporting adoption. S&P Global also expanded its integration of AI-ready data into Microsoft 365 Copilot workflows. Swiss Enterprises Prioritize Microsoft AI Governance Positive Sentiment: Analyst and institutional sentiment remains constructive. William Blair reaffirmed a Buy rating, citing early AI monetization, while Altarock Partners increased its Microsoft position. Microsoft Buy Rating Reaffirmed About Microsoft (Free Report)

Microsoft Corporation is a global technology company headquartered in Redmond, Washington. Founded in 1975 by Bill Gates and Paul Allen, Microsoft develops, licenses and supports a broad range of software products, services and devices for consumers, enterprises and governments worldwide. Its operations span personal computing, productivity software, cloud infrastructure, enterprise applications, developer tools and gaming.

Microsoft’s product portfolio includes the Windows operating system and the Microsoft 365 suite of productivity and collaboration tools (Office apps, Outlook, Teams).

Further Reading Five stocks we like better than Microsoft The AI Boom Is Turning This Cable Maker Into a Stock to Watch A Star Investor Just Trimmed Amazon—Here’s What It means Wendy’s Deal Buzz May Give Fast-Food Investors a New Reason to Look Home Depot Analysts See a Path to $375 and Beyond Want to see what other hedge funds are holding MSFT? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Microsoft Corporation (NASDAQ:MSFT – Free Report).

Receive News & Ratings for Microsoft Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Microsoft and related companies with MarketBeat.com's FREE daily email newsletter.

Cedar Mountain Advisors LLC trimmed its stake in shares of Microsoft Corporation (NASDAQ:MSFT – Free Report) by 35.9% in the 2nd quarter, according to its most recent 13F filing with the Securities and Exchange Commission (SEC). The institutional investor owned 2,759 shares of the software giant’s stock after selling 1,546 shares during the quarter. Cedar Mountain Advisors LLC’s holdings in Microsoft were worth $1,029,000 at the end of the most recent quarter.

Several other large investors also recently bought and sold shares of the stock. WFA Asset Management Corp boosted its position in shares of Microsoft by 27.0% during the 1st quarter. WFA Asset Management Corp now owns 1,016 shares of the software giant’s stock worth $427,000 after acquiring an additional 216 shares in the last quarter. Ironwood Wealth Management LLC. lifted its stake in Microsoft by 0.3% during the second quarter. Ironwood Wealth Management LLC. now owns 12,658 shares of the software giant’s stock worth $5,658,000 after purchasing an additional 38 shares during the last quarter. Discipline Wealth Solutions LLC boosted its holdings in Microsoft by 410.4% in the third quarter. Discipline Wealth Solutions LLC now owns 2,659 shares of the software giant’s stock valued at $1,144,000 after purchasing an additional 2,138 shares in the last quarter. Wealth Group Ltd. increased its stake in Microsoft by 1.2% in the fourth quarter. Wealth Group Ltd. now owns 2,374 shares of the software giant’s stock valued at $1,000,000 after purchasing an additional 28 shares during the last quarter. Finally, Eagle Capital Management LLC raised its holdings in Microsoft by 0.4% during the fourth quarter. Eagle Capital Management LLC now owns 23,097 shares of the software giant’s stock worth $9,735,000 after purchasing an additional 96 shares in the last quarter. Hedge funds and other institutional investors own 71.13% of the company’s stock.

Analysts Set New Price Targets Several brokerages have recently weighed in on MSFT. Argus reduced their price objective on shares of Microsoft from $620.00 to $510.00 and set a “buy” rating for the company in a research report on Friday, July 10th. Truist Financial reiterated a “buy” rating and set a $575.00 price target on shares of Microsoft in a research note on Wednesday, July 22nd. BMO Capital Markets boosted their price target on shares of Microsoft from $500.00 to $515.00 and gave the company an “outperform” rating in a research report on Thursday, July 30th. Stifel Nicolaus upped their price objective on shares of Microsoft from $400.00 to $450.00 and gave the company a “hold” rating in a research note on Thursday, July 30th. Finally, UBS Group set a $525.00 target price on Microsoft in a research report on Thursday, July 30th. Forty-two analysts have rated the stock with a Buy rating and five have given a Hold rating to the company. According to MarketBeat, the stock has a consensus rating of “Moderate Buy” and an average price target of $560.27.

Read Our Latest Report on Microsoft Microsoft Stock Up 0.3% MSFT stock opened at $481.63 on Wednesday. The company has a market cap of $3.58 trillion, a price-to-earnings ratio of 26.82, a price-to-earnings-growth ratio of 1.59 and a beta of 1.10. The company has a fifty day moving average price of $414.21 and a 200 day moving average price of $408.06. The company has a debt-to-equity ratio of 0.07, a current ratio of 1.23 and a quick ratio of 1.22. Microsoft Corporation has a 12 month low of $349.20 and a 12 month high of $553.72.

Microsoft (NASDAQ:MSFT – Get Free Report) last issued its quarterly earnings data on Wednesday, July 29th. The software giant reported $4.74 earnings per share (EPS) for the quarter, topping the consensus estimate of $4.24 by $0.50. The company had revenue of $90.01 billion for the quarter, compared to the consensus estimate of $87.62 billion. Microsoft had a net margin of 40.31% and a return on equity of 31.98%. Microsoft’s revenue for the quarter was up 17.7% on a year-over-year basis. During the same period last year, the firm posted $3.65 EPS. Sell-side analysts expect that Microsoft Corporation will post 19.59 earnings per share for the current year.

Microsoft Announces Dividend The business also recently declared a quarterly dividend, which will be paid on Thursday, September 10th. Investors of record on Thursday, August 20th will be given a $0.91 dividend. This represents a $3.64 annualized dividend and a yield of 0.8%. The ex-dividend date is Thursday, August 20th. Microsoft’s payout ratio is 20.27%.

Insider Activity In other Microsoft news, EVP Takeshi Numoto sold 4,810 shares of Microsoft stock in a transaction that occurred 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 transaction, the executive vice president directly owned 42,677 shares in the company, valued at approximately $21,188,276.96. This trade represents a 10.13% decrease in their position. The sale was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, CEO Judson Althoff sold 15,500 shares of the business’s stock in a transaction that occurred on Monday, June 1st. The shares were sold at an average price of $460.99, for a total value of $7,145,345.00. Following the completion of the transaction, the chief executive officer directly owned 110,477 shares in the company, valued at approximately $50,928,792.23. The trade was a 12.30% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders sold a total of 37,310 shares of company stock worth $17,256,219 in the last 90 days. 0.03% of the stock is currently owned by insiders.

More Microsoft News Here are the key news stories impacting Microsoft this week:

Positive Sentiment: Azure and Copilot momentum remain the primary catalysts. Azure reportedly surpassed $100 billion in annual revenue, while Microsoft 365 Copilot exceeded 30 million paid seats. Those milestones reinforce the view that Microsoft is beginning to monetize its AI investments at scale. Price Prediction: One Number Could Decide How High Microsoft Goes in 2027 Positive Sentiment: Strong quarterly results continue to support the bull case. Microsoft’s latest report showed earnings per share of $4.74 versus a $4.24 consensus estimate and revenue of $90.01 billion, up 17.7% year over year. Cloud computing and AI helped drive roughly 30% profit growth. These Telltale Signs Cue Microsoft Investors Despite Earnings Surge Positive Sentiment: Enterprise adoption and partnerships are broadening demand. Swiss companies are increasing their use of Microsoft’s AI and cloud products, with governance and data sovereignty controls supporting adoption. S&P Global also expanded its integration of AI-ready data into Microsoft 365 Copilot workflows. Swiss Enterprises Prioritize Microsoft AI Governance Positive Sentiment: Analyst and institutional sentiment remains constructive. William Blair reaffirmed a Buy rating, citing early AI monetization, while Altarock Partners increased its Microsoft position. Microsoft Buy Rating Reaffirmed Microsoft Company Profile (Free Report)

Microsoft Corporation is a global technology company headquartered in Redmond, Washington. Founded in 1975 by Bill Gates and Paul Allen, Microsoft develops, licenses and supports a broad range of software products, services and devices for consumers, enterprises and governments worldwide. Its operations span personal computing, productivity software, cloud infrastructure, enterprise applications, developer tools and gaming.

Microsoft’s product portfolio includes the Windows operating system and the Microsoft 365 suite of productivity and collaboration tools (Office apps, Outlook, Teams).

Featured Stories Five stocks we like better than Microsoft The AI Boom Is Turning This Cable Maker Into a Stock to Watch A Star Investor Just Trimmed Amazon—Here’s What It means Wendy’s Deal Buzz May Give Fast-Food Investors a New Reason to Look Home Depot Analysts See a Path to $375 and Beyond Want to see what other hedge funds are holding MSFT? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Microsoft Corporation (NASDAQ:MSFT – Free Report).

Receive News & Ratings for Microsoft Daily - Enter your email address below to receive a concise daily summary of the latest news and analysts' ratings for Microsoft and related companies with MarketBeat.com's FREE daily email newsletter.