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I keep hitting the buy button on Microsoft (NASDAQ:MSFT | MSFT Price Prediction), and the most recent quarter told me exactly why I should not stop. Enterprise demand is absorbing AI compute faster than Microsoft can deploy it, and the receipts are on the income statement.

The number one reason is straightforward: Azure just crossed $100 billion in annual revenue for the first time, and growth is speeding up rather than plateauing. Azure revenue grew 43% year-over-year in Q4, and management guided Q1 FY27 Azure growth even higher, to 45% in constant currency. A business this large re-accelerating is the signal I care about.

The Data That Keeps Me Adding Fiscal Q4 2026, reported July 29, 2026, delivered $90.01 billion in revenue, up 17.75% year-over-year, and non-GAAP diluted EPS of $4.74, beating estimates by 11.81%. That is the fifth consecutive EPS beat. Intelligent Cloud produced $39.31 billion in revenue, up 32%, and Microsoft Cloud reached $59.3 billion, up 27%.

The pipeline behind those numbers is what convinces me this is durable. Commercial remaining performance obligations, the contracted revenue Microsoft has booked but not yet delivered, stand at $678 billion, up 84% year-over-year. That figure is the AI transformation showing up as signed customer commitments. Microsoft 365 Copilot has climbed to over 30 million paid seats, each of them a subscription add-on inside an already-invoiced customer.

The business quality is what lets me sleep. Return on invested capital of 22%, an operating margin of nearly 47%, and a debt-to-equity ratio of 0.29 tell me this is a company earning outsized returns without stretching its balance sheet. Operating cash flow grew 30% in the quarter to $55.4 billion.

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Why Not the Obvious Alternatives I could have channeled the same capital into Alphabet (NASDAQ:GOOGL) for Google Cloud exposure, into Amazon (NASDAQ:AMZN) for AWS, or into NVIDIA (NASDAQ:NVDA) to own the silicon. What keeps my money with Microsoft is the layer none of them controls: the productivity software already installed at nearly every large enterprise on the planet. That $678 billion RPO represents contracted revenue riding on Office, Teams, Dynamics, and Windows, sold into customers Microsoft already bills every month. NVIDIA sells the picks. Microsoft owns the mine and the town around it.

The Risk I’m Watching Capex is the real concern. Full-year FY26 capital expenditures hit $115.95 billion, up 109.63% year-over-year, and full-year free cash flow fell 6.46%. That is real money spent ahead of returns, and if AI monetization stalls, the spend becomes stranded capacity. What keeps me adding anyway is the RPO trajectory and the Copilot seat count. Customers are paying for the capacity as it is being built, and operating cash flow is accelerating faster than the capex bill can weigh it down.

Forward Conviction Satya Nadella put it plainly: “We are advancing the frontier on the cost-to-outcome curve, ensuring every customer can turn tokens into business results.” Microsoft is selling the layer that converts compute into revenue for the customer, and that is the mechanic that compounds subscription economics over decades.

At $487.65 and roughly 27 times earnings, I am paying a fair multiple for the highest-quality compounder in enterprise software, plus a 0.73% dividend with room to grow. The buy button stays active because every quarter the receipts get harder to argue with.

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Contact [email protected] for any questions or corrections.

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Hyperscaler shares have ripped higher over the past week. Microsoft (NASDAQ:MSFT | MSFT Price Prediction) is up 26.5% in the last five trading days, Amazon (NASDAQ:AMZN) has climbed 20.4% over the same stretch, and Alphabet (NASDAQ:GOOGL) has added 12.5%. Uncover Alpha’s Rihard Jarc argues on X that this is only the beginning, writing, “I have called for a violent shift in upside repricing for hyperscalers… The repricing is in the works, and it is violent.” For investors who watched the move from the sidelines, the question is simple: is the door still open, or did the trade already run away?

Valuation: The Case Still Stands Start with the multiples. Alphabet trades at roughly 17 times earnings while growing revenue 24% year over year, with Google Cloud accelerating 82% and operating margin expanding to 35.6% from 20.7%. Microsoft carries a P/E near 26, supported by 17.75% revenue growth, 46.78% operating margins, and a $678 billion RPO backlog that grew 84% year over year. Amazon is the richest of the three at roughly 32 times earnings, but AWS is compounding at 37%, a pace not seen in 18 quarters, with a 39.4% operating margin. For companies this large, growing this fast, the multiples do not look stretched enough to kill the trade.

Forward Catalyst: Backlog and Buildout The forward setup is unusually visible. Microsoft’s Azure crossed $100 billion in annual revenue, a major milestone, and Microsoft 365 Copilot passed 30 million paid seats. Not to be outdone, Alphabet’s Cloud backlog reached $514 billion, and CFO Anat Ashkenazi raised full-year capex guidance to $195 billion to $205 billion to keep up with demand.

Amazon’s AI and custom-chips businesses each eclipsed a $25 billion annualized run rate. UBS now projects Amazon could exceed $500 billion in net profits by 2030. Management’s Q3 2026 guidance calls for operating income of $22.5 billion to $26.5 billion, up from $17.4 billion a year earlier.

Risk and Entry: Where the Downside Lives The real risk is capex outrunning cash flow. Alphabet’s free cash flow turned negative $5.9 billion in Q2, worrying investors. Long-term debt swelled from $46.5 billion to $98.2 billion, and the buyback was suspended. Amazon’s TTM free cash flow sits at negative $7.6 billion after $54.2 billion of quarterly capex. Microsoft’s FCF fell 23.19% for the year as capex more than doubled to $115.95 billion.

Polymarket traders are also flagging near-term caution, pricing a 90.5% probability of a down day for Amazon on August 4. Independent research corroborates the structural case, with MetLife and PineBridge writing that “datacenter equipment growth as essentially locked in for the next four to five years” at roughly 25% annually.

The Verdict It is not too late. Alphabet is the clearest value at 17 times earnings with 82% cloud growth and Wall Street targeting $426.95. Microsoft offers the highest-quality compounder profile, with analysts and buyers absorbing the capex on the strength of that $678 billion backlog. Amazon carries the richest multiple, but the AWS reacceleration and Q3 operating-income guide leave room to grow into it. For long-term investors evaluating exposure, the setup across all three names looks constructive even after a single day’s move, with plenty of forward catalysts still on the calendar.

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Contact [email protected] for any questions or corrections.

Posted by Defense World Staff on Aug 4th, 2026

California Public Employees Retirement System raised its position in shares of Microsoft Corporation (NASDAQ:MSFT – Free Report) by 3.7% in the first quarter, according to its most recent Form 13F filing with the Securities and Exchange Commission (SEC). The firm owned 21,906,086 shares of the software giant’s stock after acquiring an additional 781,973 shares during the period. Microsoft makes up 5.0% of California Public Employees Retirement System’s portfolio, making the stock its 4th biggest holding. California Public Employees Retirement System owned approximately 0.29% of Microsoft worth $8,108,976,000 at the end of the most recent reporting period.

Several other hedge funds and other institutional investors also recently made changes to their positions in the business. Longfellow Investment Management Co. LLC raised its position 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 valued at $29,000 after buying an additional 20 shares during the last quarter. Bernzott Capital Advisors acquired a new stake in Microsoft during the fourth quarter worth about $34,000. Timmons Wealth Management LLC bought a new position in Microsoft during the fourth quarter valued at about $36,000. Fairway Wealth LLC lifted its position in shares of 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 acquiring an additional 66 shares during the period. Finally, LSV Asset Management acquired a new stake in shares of Microsoft during the 4th quarter worth approximately $44,000. 71.13% of the stock is owned by institutional investors and hedge funds.

Insider Buying and Selling at Microsoft In other news, EVP Takeshi Numoto sold 4,500 shares of the firm’s stock in a transaction on Wednesday, June 10th. The stock was sold at an average price of $402.84, for a total value of $1,812,780.00. Following the completion of the sale, the executive vice president directly owned 47,468 shares in the company, valued at approximately $19,122,009.12. This trade represents a 8.66% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is available through this link. Also, EVP Amy Coleman sold 1,262 shares of Microsoft stock in a transaction dated Thursday, May 14th. The shares were sold at an average price of $411.34, for a total value of $519,111.08. Following the completion of the transaction, the executive vice president directly owned 46,003 shares of the company’s stock, valued at $18,922,874.02. This represents a 2.67% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. In the last quarter, insiders sold 23,762 shares of company stock worth $10,508,361. 0.03% of the stock is currently owned by insiders.

Wall Street Analysts Forecast Growth A number of analysts have recently issued reports on the company. Deutsche Bank Aktiengesellschaft restated a “buy” rating on shares of Microsoft in a research report on Monday, July 20th. President Capital boosted their price target on shares of Microsoft from $500.00 to $520.00 and gave the company a “buy” rating in a report on Thursday, April 30th. Barclays dropped their price objective on shares of Microsoft from $545.00 to $512.00 and set an “overweight” rating for the company in a research note on Thursday. Weiss Ratings reaffirmed a “hold (c)” rating on shares of Microsoft in a report on Monday, July 6th. Finally, UBS Group set a $525.00 target price on shares of Microsoft in a research note on Thursday. Forty-two investment analysts have rated the stock with a Buy rating and five have given a Hold rating to the stock. According to data from MarketBeat.com, Microsoft currently has a consensus rating of “Moderate Buy” and a consensus target price of $558.64.

Get Our Latest Research Report on MSFT

Microsoft Stock Up 4.9% Shares of NASDAQ MSFT opened at $487.65 on Tuesday. Microsoft Corporation has a 52-week low of $349.20 and a 52-week high of $553.72. The company has a debt-to-equity ratio of 0.07, a quick ratio of 1.22 and a current ratio of 1.23. The business has a fifty day moving average of $399.37 and a two-hundred day moving average of $405.57. The stock has a market cap of $3.62 trillion, a PE ratio of 27.15, a PEG ratio of 1.48 and a beta of 1.10.

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 the consensus estimate of $4.24 by $0.50. The business had revenue of $90.01 billion for the quarter, compared to analyst estimates of $87.62 billion. Microsoft had a net margin of 40.31% and a return on equity of 31.98%. The firm’s quarterly revenue was up 17.7% compared to the same quarter last year. During the same quarter in the prior year, the firm earned $3.65 EPS. As a group, equities research analysts expect that Microsoft Corporation will post 19.53 earnings per share for the current fiscal year.

Microsoft Announces Dividend The firm 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 dividend of $0.91 per share. The ex-dividend date is Thursday, August 20th. This represents a $3.64 dividend on an annualized basis and a yield of 0.7%. Microsoft’s dividend payout ratio is 20.27%.

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

Positive Sentiment: Azure growth and AI monetization are driving the rally. Microsoft’s quarterly revenue and earnings exceeded expectations, while Azure growth accelerated to approximately 30%. Analysts and commentators said demand for cloud and generative-AI services is beginning to justify the company’s roughly $175 billion in annual spending. Microsoft Just Proved that AI Spending Can Pay Off Positive Sentiment: Strong bookings and infrastructure commitments support future revenue. Microsoft’s cloud backlog and more than $100 billion in data-center leases indicate that customers are committing to long-term capacity, giving investors greater confidence in continued Azure and AI expansion. Big Tech’s Cloud Backlog Just Hit $2.3 Trillion Positive Sentiment: Wall Street sentiment has improved. Analysts described Microsoft as one of the better-positioned hyperscalers in the AI race, citing its balance sheet, recurring software revenue, free-cash-flow generation and cloud leadership. The post-earnings advance has erased the stock’s prior 2026 losses and renewed expectations for additional upside. Microsoft’s Stock Is on a Run Not Seen in 26 Years Neutral Sentiment: Microsoft 365 ecosystem expansion. Paychex launched its WISE workforce-intelligence integration in Microsoft 365 Copilot and Teams, reinforcing Microsoft’s platform reach among small and midsize businesses, although the direct financial impact for MSFT is likely modest. Paychex Brings WISE Workforce Intelligence to Microsoft 365 Copilot and Teams Negative Sentiment: Securities litigation remains an overhang. Several law firms publicized a class action concerning alleged misrepresentations about Copilot functionality, AI adoption and Azure growth, with an August 11 lead-plaintiff deadline. The announcements do not establish liability but could increase legal, reputational and disclosure risks. MSFT Shareholder Alert Negative Sentiment: Capital spending and free cash flow remain watch points. The scale of AI infrastructure spending could pressure cash flow and returns if monetization slows, even though recent results have eased those concerns. The AI Spending Boom and Free Cash Flow 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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Clifford Swan Investment Counsel LLC trimmed its stake in shares of Microsoft Corporation (NASDAQ:MSFT – Free Report) by 0.9% in the first quarter, according to the company in its most recent Form 13F filing with the Securities and Exchange Commission (SEC). The firm owned 300,292 shares of the software giant’s stock after selling 2,800 shares during the quarter. Microsoft comprises approximately 3.8% of Clifford Swan Investment Counsel LLC’s investment portfolio, making the stock its 3rd biggest position. Clifford Swan Investment Counsel LLC’s holdings in Microsoft were worth $111,159,000 as of its most recent SEC filing.

Several other institutional investors and hedge funds have also recently modified their holdings of the stock. Norges Bank acquired a new stake in Microsoft during the fourth quarter worth approximately $50,664,631,000. Auto Owners Insurance Co grew its position in shares of Microsoft by 56,160.8% in the fourth quarter. Auto Owners Insurance Co now owns 60,116,384 shares of the software giant’s stock valued at $29,073,486,000 after purchasing an additional 60,009,531 shares during the last quarter. Nuveen LLC bought a new position in shares of Microsoft during the first quarter worth approximately $18,733,827,000. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC increased its stake in shares of Microsoft by 500.0% during 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 worth $30,840,432,000 after purchasing an additional 49,618,571 shares during the period. Finally, Laurel Wealth Advisors LLC lifted its holdings in Microsoft by 49,640.3% during the 2nd 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 during the last quarter. 71.13% of the stock is currently owned by institutional investors and hedge funds.

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

Positive Sentiment: Azure growth and AI monetization are driving the rally. Microsoft’s quarterly revenue and earnings exceeded expectations, while Azure growth accelerated to approximately 30%. Analysts and commentators said demand for cloud and generative-AI services is beginning to justify the company’s roughly $175 billion in annual spending. Microsoft Just Proved that AI Spending Can Pay Off Positive Sentiment: Strong bookings and infrastructure commitments support future revenue. Microsoft’s cloud backlog and more than $100 billion in data-center leases indicate that customers are committing to long-term capacity, giving investors greater confidence in continued Azure and AI expansion. Big Tech’s Cloud Backlog Just Hit $2.3 Trillion Positive Sentiment: Wall Street sentiment has improved. Analysts described Microsoft as one of the better-positioned hyperscalers in the AI race, citing its balance sheet, recurring software revenue, free-cash-flow generation and cloud leadership. The post-earnings advance has erased the stock’s prior 2026 losses and renewed expectations for additional upside. Microsoft’s Stock Is on a Run Not Seen in 26 Years Neutral Sentiment: Microsoft 365 ecosystem expansion. Paychex launched its WISE workforce-intelligence integration in Microsoft 365 Copilot and Teams, reinforcing Microsoft’s platform reach among small and midsize businesses, although the direct financial impact for MSFT is likely modest. Paychex Brings WISE Workforce Intelligence to Microsoft 365 Copilot and Teams Negative Sentiment: Securities litigation remains an overhang. Several law firms publicized a class action concerning alleged misrepresentations about Copilot functionality, AI adoption and Azure growth, with an August 11 lead-plaintiff deadline. The announcements do not establish liability but could increase legal, reputational and disclosure risks. MSFT Shareholder Alert Negative Sentiment: Capital spending and free cash flow remain watch points. The scale of AI infrastructure spending could pressure cash flow and returns if monetization slows, even though recent results have eased those concerns. The AI Spending Boom and Free Cash Flow Wall Street Analysts Forecast Growth Several analysts recently issued reports on MSFT shares. Piper Sandler boosted their price target on Microsoft from $540.00 to $550.00 and gave the company an “overweight” rating in a research note on Tuesday, July 28th. Robert W. Baird dropped their target price on Microsoft from $540.00 to $500.00 and set an “outperform” rating for the company in a report on Wednesday, April 15th. CLSA reissued an “outperform” rating on shares of Microsoft in a research report on Thursday. 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 note on Thursday, April 30th. Finally, Citigroup restated a “buy” rating and issued a $600.00 price target (up from $570.00) on shares of Microsoft in a research note on Tuesday, July 28th. Forty-two analysts have rated the stock with a Buy rating and five have assigned a Hold rating to the company’s stock. According to data from MarketBeat, the company currently has a consensus rating of “Moderate Buy” and a consensus target price of $558.64.

Get Our Latest Research Report on Microsoft

Insider Buying and Selling at Microsoft In other Microsoft news, CEO Judson Althoff sold 15,500 shares of the company’s stock in a transaction on Monday, June 1st. The stock was 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 $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 Securities & Exchange Commission, which is available at the SEC website. Also, EVP Takeshi Numoto sold 4,500 shares of Microsoft stock in a transaction on Wednesday, June 10th. The shares were sold at an average price of $402.84, for a total value of $1,812,780.00. Following the completion of the transaction, the executive vice president owned 47,468 shares in the company, valued at approximately $19,122,009.12. The trade was a 8.66% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders sold a total of 23,762 shares of company stock worth $10,508,361 over the last three months. Corporate insiders own 0.03% of the company’s stock.

Microsoft Stock Up 4.9% MSFT stock opened at $487.65 on Tuesday. Microsoft Corporation has a 52 week low of $349.20 and a 52 week high of $553.72. The business has a 50-day simple moving average of $399.37 and a 200 day simple moving average of $405.57. The company has a quick ratio of 1.22, a current ratio of 1.23 and a debt-to-equity ratio of 0.07. The company has a market cap of $3.62 trillion, a PE ratio of 27.15, a price-to-earnings-growth ratio of 1.48 and a beta of 1.10.

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 (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 business’s revenue for the quarter was up 17.7% on a year-over-year basis. During the same period in the prior year, the company posted $3.65 earnings per share. Sell-side analysts anticipate that Microsoft Corporation will post 19.53 EPS for the current fiscal year.

Microsoft Announces Dividend 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 paid a $0.91 dividend. This represents a $3.64 dividend on an annualized basis and a yield of 0.7%. The ex-dividend date of this dividend is Thursday, August 20th. 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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, /PRNewswire/ -- The Gross Law Firm issues the following notice to shareholders of Microsoft Corporation (NASDAQ: MSFT).

Shareholders who purchased shares of MSFT during the class period listed are encouraged to contact the firm regarding possible lead plaintiff appointment. Appointment as lead plaintiff is not required to partake in any recovery.

CONTACT US HERE:

https://securitiesclasslaw.com/securities/microsoft-corporation-loss-submission-form/?id=198117&from=4

CLASS PERIOD: May 1, 2025 to January 28, 2026

ALLEGATIONS: The complaint alleges that during the class period, Defendants issued materially false and/or misleading statements and/or failed to disclose that: (a) Microsoft's Copilot family of products had experienced significant brand positioning, user experience, usage, data siloing, computational capacity, organizational, and interoperability problems; (b) Microsoft's flagship proprietary AI model ranked well below competitors on a number of benchmark tests; (c) Microsoft needed to increase by billions of dollars its capital expenditures and divert GPU and CPU capacity away from fulfilling demand for its profitable Azure services in order to improve the competitive positioning of its critical Copilot family of products and increase its AI-related R&D; and (d) as a result of (a)-(c) above, Microsoft had failed to convert a significant percentage of its commercial Microsoft 365 users to paid Copilot subscriptions and the Company's Copilot offerings had lost market share to rival products, a trend that was increasing.

DEADLINE: August 11, 2026 Shareholders should not delay in registering for this class action. Register your information here: https://securitiesclasslaw.com/securities/microsoft-corporation-loss-submission-form/?id=198117&from=4

NEXT STEPS FOR SHAREHOLDERS: Once you register as a shareholder who purchased shares of MSFT during the timeframe listed above, you will be enrolled in a portfolio monitoring software to provide you with status updates throughout the lifecycle of the case. The deadline to seek to be a lead plaintiff is August 11, 2026. There is no cost or obligation to you to participate in this case.

WHY GROSS LAW FIRM? The Gross Law Firm is a nationally recognized class action law firm, and our mission is to protect the rights of all investors who have suffered as a result of deceit, fraud, and illegal business practices. The Gross Law Firm is committed to ensuring that companies adhere to responsible business practices and engage in good corporate citizenship. The firm seeks recovery on behalf of investors who incurred losses when false and/or misleading statements or the omission of material information by a company lead to artificial inflation of the company's stock. Attorney advertising. Prior results do not guarantee similar outcomes.

CONTACT:
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SOURCE The Gross Law Firm

Microsoft (NASDAQ:MSFT | MSFT Price Prediction) has delivered one of the most dramatic post-earnings rallies in mega-cap history. My 24/7 Wall St. price target says the run has legs, but with a caveat about how quickly the market got here.

Microsoft trades at $487.65 after a 25.33% one-week surge triggered by a blowout Q4 FY26 earnings report. Our 24/7 Wall St. price target for Microsoft is $573.79, implying 23.47% upside over the next 12 months. The recommendation is buy at 90% confidence. Azure crossing $100B in annual revenue and Copilot scaling past 30M paid seats are the pillars.

24/7 Wall St. Price Target Summary Metric Value Current Price $487.65 24/7 Wall St. Price Target $573.79 Upside 23.47% Recommendation BUY Confidence Level 90% The Rally That Rewrote The Chart MSFT entered earnings week near $389, down from a 52-week high of $550.24 and stuck in a months-long slide from last August. Q4 FY26 delivered: Revenue hit $90.01 billion, up 17.75% YoY, with non-GAAP EPS of $4.74 against $4.2397 consensus, an 11.81% beat.

Azure grew 43% and commercial RPO ballooned to $678 billion, up 84% YoY. Shares jumped 15.51% on the earnings report, the largest single-day earnings reaction in the six-quarter dataset.

The Case For $600+ Bulls have real ammunition. Azure crossed $100 billion in annual revenue, Microsoft 365 Copilot passed 30 million paid seats, and the extended OpenAI partnership locks in $250B Azure commitment through 2032.

Our bull-case scenario points to $603.61, a 29.89% total return. Reddit chatter reflects the shift, with sentiment jumping from 35 on July 28 to 94 by July 31.

What Could Go Wrong The bear case starts with capex. Full-year FY26 capex hit $115.95 billion, with Q4 consuming $35.80 billion, up 109.63% YoY. Free cash flow fell 23.19% in the quarter. Bulls counter that FCF pressure reflects buildout supporting the $678B RPO backlog, meaning spend has contracted demand behind it.

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More Personal Computing revenue declined 4%, insider activity shows net selling across 33 recent transactions, and mean reversion is real. Historical MSFT one-week post-earnings returns average -2.16%. Our bear scenario is $495.94.

How Microsoft Compares To Alphabet, Amazon, And Oracle Alphabet (NASDAQ:GOOGL) is the closest cloud competitor via Google Cloud. Amazon (NASDAQ:AMZN) runs AWS, Azure’s direct hyperscale rival. Oracle (NYSE:ORCL) has emerged as the surprise enterprise-AI infrastructure winner, with RPO growth paralleling Microsoft’s $678B backlog.

Microsoft trades at a trailing P/E of 27 with forward P/E near 26 against 31.7% earnings growth and a 46.78% operating margin. That margin premium, combined with Azure’s 43% growth rate, makes our $573.79 target reasonable against the peer group.

The Bull Case Holds, With Discipline The 24/7 Wall St. price target of $573.79 and buy rating stand at 90% confidence. The RPO backlog tips the scale. Contracted future revenue that grew 84% YoY is rare at this scale.

The setup looks most attractive on any pullback above the $460 pre-rally breakout, while a Q1 FY27 print showing Azure decelerating below 35% or capex efficiency worsening would warrant caution. Given the vertical rally, the setup favors scaling in rather than chasing.

Year 24/7 Wall St. Price Target 2026 $525 2027 $573.79 2028 $665 2029 $765 2030 $870.44 These projections assume Microsoft executes on Azure and Copilot monetization. Significant upside or downside could result from AI capex returns materializing faster than expected, or regulatory action against the OpenAI partnership.

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Contact [email protected] for any questions or corrections.

Microsoft’s (NASDAQ: MSFT) upcoming quarterly dividend has been scheduled for Thursday, September 10, 2026, with the current estimates suggesting the company is going to reward investors as of August 20 with $0.91 per share. 

The September dividend represents no change from the previous three payouts, issued on June 11, 2026, March 12, 2026, and December 11, 2025, according to the official announcement.

Accordingly, investors holding 100 Microsoft shares by August 20 will earn a total of $91 in dividend income next month. If the tech giant does not increase the payout, the yearly Microsoft stock dividend for 2026 will total $364.

MSFT quarterly dividend. Source: Microsoft.com Microsoft Corp. dividend profile Microsoft continues to maintain one of the most consistent dividend records in the technology sector, with a forward dividend yield of 0.75% and an annualized dividend of $3.64 per share.

What’s more, the software leader has increased its dividend for 24 consecutive years, and with a relatively conservative forward payout ratio of 18.54%, it has significant room to continue funding dividend growth while investing in its core businesses.

Historically, Microsoft’s shares have recovered quickly after going ex-dividend, with an average price recovery time of 1.7 days. Although its 0.75% dividend yield sits below the broader technology sector average of 1.37%, the company has prioritized steady dividend increases and share price appreciation over offering a high yield.

Even in 2026, which has been one of Microsoft’sweakest years on record, the stock has managed to recover, now sitting up around 3% year-to-date as of press time. For context, a $10,000 investment in Microsoft at the start of 2026, with all dividends reinvested, would now be worth $10,415. 

In other words, the investment would have generated $38.19 in reinvested dividends and $376.82 in capital gains, for a total profit of $415, representing a 4.15% total return.

Featured image via Shutterstock

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This earnings season has been chock-full of volatility. Amazon (AMZN +4.58%) and Microsoft (MSFT +4.93%) added a combined $1.04 trillion in market cap between July 29 and July 31, while Apple (AAPL -1.78%) and Meta Platforms (META +6.02%) shed a combined $510 billion.

Here's why megacap stock prices are all over the place, as well as a straightforward way for investors to filter through the noise with a low-cost exchange-traded fund (ETF).

Image source: Getty Images.

Wall Street turns from sour to sweet on Microsoft and Amazon Going into earnings, Microsoft and Amazon were badly underperforming the S&P 500 (^GSPC +1.48%) and Nasdaq Composite (^IXIC +2.13%) this year as investors questioned the payoff from capital expenditure (capex) on artificial intelligence (AI). Investors were gravitating toward Apple because of its high free cash flow (FCF) and limited capex spending. AI tools, from enterprise software to chatbots, ultimately operate on consumer electronics, and Apple has an unmatched integrated ecosystem of devices.

But Apple fell after reporting earnings because memory chip costs could continue eating into its profit margins. And Meta Platforms' FCF is evaporating due to surging AI capex and operating expenses.

Meanwhile, Amazon stock popped because Amazon Web Services (AWS) achieved its fastest growth in 18 quarters, and its retail business is booming. Similarly, Microsoft, which is the No. 2 player in cloud infrastructure behind AWS, saw Azure revenue top $100 billion for the first time in a full fiscal year.

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Cut through market noise with a low-cost ETF Earnings drive stock prices over the long term. But in the near term, narratives and investor sentiment have significant influence. So, if you're left scratching your head as to why Amazon and Microsoft were so badly undervalued that they could gain more than $1 trillion combined in just two days or why Apple and Meta underwent steep sell-offs -- then you're not alone.

The Vanguard Mega Cap Growth ETF (MGK +2.22%) offers the simplest way to bet on sustained AI innovation from today's market leaders without having to fixate on why some stocks are in or out of favor.

The fund is essentially an even more concentrated version of the popular Vanguard Growth ETF. And unlike index-specific ETFs, such as the Invesco QQQ Trust, which tracks the Nasdaq-100, the Vanguard Mega Cap Growth ETF holds stocks like Eli Lilly and Oracle that are on the New York Stock Exchange rather than the Nasdaq.

With a staggering 67% weighting in just 10 holdings -- Nvidia, Apple, Alphabet, Microsoft, Amazon, Broadcom, Meta Platforms, Tesla, Eli Lilly, and Advanced Micro Devices -- the fund is essentially a concentrated bet that today's market leaders will continue driving outsize gains for years to come. That bet has paid off, as the Vanguard Mega Cap Growth ETF has outperformed the S&P 500 during the past decade.

MGK Total Return Level data by YCharts.

A catch-all bet on today's market-leading growth stocks The Vanguard Mega Cap Growth ETF is a good buy for investors seeking significant exposure to chip leaders, cloud computing giants such as Amazon, Microsoft, and Alphabet, and more. The ETF could be a particularly appealing buy for investors looking for exposure to top growth stocks rather than just one sector.

For example, Nvidia, Apple, Microsoft, and Broadcom lead the tech sector; Amazon and Tesla are in the consumer discretionary sector; Alphabet and Meta dominate the communications sector; and Eli Lilly is a powerhouse growth stock that leads the healthcare sector. And with a mere 0.05% expense ratio, the ETF has just $5 in annual fees for every $10,000 invested. By comparison, the Vanguard Growth ETF and Vanguard S&P 500 ETF have 0.03% expense ratios, which means $3 in annual fees for every $10,000 invested.

The Vanguard Mega Cap Growth ETF is a good buy for investors who want exposure to the top growth stocks across all sectors, with an emphasis on today's industry leaders rather than spreading their allocation among lower-weighted components. Put another way, the Vanguard Mega Cap Growth ETF is a better buy than the Vanguard Growth ETF, a Nasdaq-100-based ETF, or an S&P 500 index fund if you believe that AI capex spending will pay off for hyperscalers like Amazon and Microsoft.

The market sent a clear stamp of approval for Amazon and Microsoft last week, casting out Apple and Meta Platforms. But just a week ago, Apple was significantly outperforming its megacap peers. The Vanguard Mega Cap Growth ETF offers a simple way for long-term investors to bet big on multiple themes rather than getting overly caught up in knee-jerk reactions to earnings reports.

Daniel Foelber has positions in Broadcom, Nvidia, and Oracle and has the following options: long September 2028 $100 calls on Oracle and short August 2026 $240 calls on Nvidia. The Motley Fool has positions in and recommends Advanced Micro Devices, Alphabet, Amazon, Apple, Broadcom, Eli Lilly, Meta Platforms, Microsoft, Nvidia, Oracle, Tesla, Vanguard Growth ETF, and Vanguard S&P 500 ETF. The Motley Fool has a disclosure policy.

Both Microsoft (MSFT +4.93%) and Amazon (AMZN +4.58%) are coming off blistering earnings reports that helped revive interest in both stocks after a tough year, though more so for Microsoft.

Microsoft and Amazon are two of the largest companies in the world by market cap, helping fuel the artificial intelligence revolution by making hundreds of billions in capital expenditures. This level of investment has drawn the ire of the bears, who are concerned that strong returns on such investments may not materialize.

Which stock does Wall Street think has more upside?

Image source: Getty Images.

Microsoft: Starting to find its AI groove Investors have been bearish on Microsoft for a few reasons. First, they were concerned that the company's artificial intelligence assistant, Copilot, was not gaining enough traction, especially since Microsoft had made it a core part of its AI strategy.

Microsoft was also penalized during the software sell-off due to concerns that Microsoft 365 might lose some of its competitive moat, based on the belief that AI could replicate software products much more quickly than in the past.

But Microsoft has shown that its AI strategy is gaining traction. Paid Copilot subscribers rose by 10 million in the quarter to reach 30 million total. That's double the net added subscribers in the prior quarter.

Furthermore, the company's Azure cloud division, Microsoft's cloud computing division, saw revenue surpass $100 billion for the first time, which is up a whopping 43% year over year. That showed investors at least some evidence that Microsoft's capex is starting to pay off.

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Of the 35 Wall Street analysts who have issued research reports on Microsoft during the past three months, 34 have buy ratings on the stock, with one recommending a hold. The average price target implies nearly 21% upside, according to TipRanks.

Following the quarter, Goldman Sachs analyst Gabriela Borges maintained a buy rating on the stock and raised her price target by $30 to $640. In a research note, Borges called the quarter an inflection point for the company that addressed investor concerns.

Not only are the company's AI products resonating with customers, but the AI business is becoming more profitable. While inflation has increased the company's AI investments, the company has maintained its long-term margin goals, Borges wrote.

I would agree that, given where the stock has traded this year, any signs that the company's AI strategy is working make the stock a buy. Although Azure stole the show, progress on Copilot was a meaningful step as well.

Amazon: AWS posts its strongest growth in 18 quarters Similar to Microsoft, Amazon's cloud business, Amazon Web Services, also stole the show in the quarter.

AWS's revenue of $42.2 billion beat analyst estimates by nearly $1.7 billion and grew 37% year over year. It was the division's fastest growth in 18 quarters.

The company also hiked its full-year capital expenditure projection to $220 billion, largely due to surging memory costs. Chief Executive Officer Andy Jassy doesn't see AWS slowing down any time soon.

"Even at that amount [of capex], we will still not have enough capacity to meet all the demand we have in 2026, and I believe this dynamic will also be true in 2027, too. In fact, the demand we already have for 2028 is striking," he said on the company's earnings call.

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Of the 38 Wall Street analysts who have issued research reports on Microsoft during the past three months, 37 have buy ratings on the stock, with one recommending a hold. The average price target implies roughly 23% upside, according to TipRanks.

Benchmark analyst Daniel Kurnos recently maintained a buy rating on the stock and raised his price target by $30 to $400, implying about a 40% gain from recent levels. Kurnos believes Jassy made the strongest case for why investors must own the stock over the next decade to capitalize on the AI revolution.

Kurnos estimates the stock trades at about 10 times the company's operating income before depreciation and amortization.

As you can see, Wall Street has similar sentiment for both Microsoft and Amazon, given the similar upside scenarios. I also think both stocks are buys right now, with evidence that their big capex sprees are not on a whim.

Both have embedded risk, particularly if the AI investment doesn't pay off. But I also expect both could navigate a difficult environment and generate strong long-term returns for investors. 

By the morning of August 4, a sudden rally after the quarterly earnings erased all stock market losses Microsoft (NASDAQ: MSFT) had suffered in 2026 – previously one of the firm’s worst years on record – and pushed the equity 3.11% into the green.

Microsoft stock price YTD chart. Source: Google The sudden change in the trend simultaneously ensured that the first-quarter (Q1) decision by the Gates Foundation to completely wipe its MSFT position might have been one of its worst.

While the exact transaction date is unknown, Microsoft stock hit highs of $483.47 and lows of $356.77 during Q1, and its average price in the timeframe stood at $435.22. 

Under the circumstances, unless Bill Gates’ foundation sold near the top, it could have missed up to $1 billion in proceeds relative to what it would have received had it waited until early August 2026.

If you invested $1,000 into Microsoft stock during Q1 lows, you’d now have this much On the flip side, if a different investor took Microsoft’s abysmal early 2026 performance as a buy rather than a sell signal and purchased $1,000 worth of MSFT near the quarter’s bottom, they’d have $1,366.85 by press time.

Additionally, even if they bought at the period’s average price of $435.22, they would still have a portfolio worth $1,120.47. Finally, even buying at the top of the Q1 range would have yielded a profit – though a significantly smaller one – as $1,000 would have turned into $1,008.65.

Bill Gates Foundation Microsoft stock sale likely part of 2045 sunsetting plan Meanwhile, it is arguably unlikely that the Gates Foundation deliberately timed its most recent and final sale of Microsoft stock. Indeed, it has been exclusively selling the equity since late 2023, and the latest purchase was as far back as Q3 2023.

Furthermore, Bill Gates outlined his plans to sunset his organization by 2045 already in the first half (H1) of 2025 when he declared his net worth would drop by an estimated 99% within roughly two decades.

In about a year, the value of the Gates Foundation portfolio dropped by approximately 25%, with the 13-F filing covering Q1, 2025, showing total holdings worth $41.8 billion and the Q1, 2026, document indicating $31.6 billion.

Featured image via Shutterstock

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Co investoři vlastně získávají, když investují do akcií společností Microsoft, Amazon a Google? To je podle ředitele EZ Primary Research Eda Zitrona klíčová otázka a odpověď naznačuje například to, jak by se měly vyvíjet tržby v oblasti cloudových služeb Googlu. Zatímco se totiž očekává, že vysoké investice do AI infrastruktury přinesou podobným společnostem diverzifikovaný růst příjmů, realita se může odlišovat. Navíc expert přidal řadu dalších úvah na téma umělé inteligence a s ní souvisejících investic.

Zitron řekl, že podle jedné z analýz banky UBS bude 27 % letošních tržeb u cloudových služeb Googlu generováno dvěma společnostmi – OpenAI a Anthropic. Příští rok už by to mělo být více než 48 %, což v absolutním vyjádření představuje 124 miliard dolarů. K tomu expert dodal, že investoři nakupují akcie společností investujících do AI infrastruktury ve víře, že tyto výdaje firmám zajistí diverzifikované příjmy z vysoké poptávky po AI službách. Výše uvedené ale ukazuje, že Google bude tyto služby „prodávat dvěma neziskovým společnostem… Většina lidí neví, že OpenAI je velkým klientem Google Cloudu.“

OpenAI podle Zitrona generuje nemalou část příjmů i u cloudových služeb Microsoftu a Amazonu. „Všem je prodáváno to, co je podle mého názoru lež, určitý skandál,“ komentoval tuto situaci, kdy podle něj existuje velká provázanost výsledků hyperscalerů a jejich růstu s poskytováním jejich služeb společnosti OpenAI a Anthropic. První z nich přitom mluvila o letošním vstupu na akciový trh, nyní se spíše hovoří o příštím roce.

Právě IPO společnosti OpenAI by podle experta mohlo být určitým zlomem, kdy věci vyplynou na povrch. Včetně toho, jak „těžce centralizované“ je celé odvětví datových center a jejich příjmů. Tedy jak závislé jsou na poskytování služeb pro OpenAI, která je zase ve svém dalším podnikání a rozvoji závislá na externím přísunu kapitálu. Zitron už před časem psal o tom, že podle dostupných informací „společnost OpenAI dosáhla v roce 2025 tržeb ve výši 13,07 miliardy dolarů a její čistá ztráta činila 38,53 miliardy dolarů“.

Pokud má být využita plánovaná kapacita nově budovaných datových center, nestačí na to podle experta poptávka ze strany zmíněných dvou firem. „OpenAI je společnost, která pálí hotovost,“ velká část jejího financování jde ze strany Softbank. K tomu expert zmínil stále aktivnější čínské společnosti a modely umělé inteligence, které mohou pro americké firmy představovat konkurenci a tlak na tržby. Tedy budoucí využití v současnosti budovaných kapacit.

Zitron také připomněl, že společnosti jako Google bývaly málo investičně a kapitálově náročné, generovaly vysoký volný tok hotovosti a měly velkou zásobu hotovosti v rozvaze. Investice do datových center to změnila a nyní jde o společnosti s vysokými hmotnými aktivy, které podle výše uvedeného využívá jen pár zákazníků. Navíc zmíněné dvě společnosti nebudou schopné využít nově budované kapacity. A bez nich podle experta poptávka také dostatečná nebude.

Microsoft (MSFT +4.93%) and Apple (AAPL -1.78%) have been rivals for decades. Not only are they competing businesses, but their high valuations frequently make them among the most valuable companies in the world. Both are in the trillion-dollar club, with market caps well in excess of $1 trillion.

Currently, Apple is the more valuable of the two stocks, with a market cap of $4.5 trillion versus $3.6 trillion for Microsoft. But within the next 18 months, I believe Microsoft will surpass Apple and be the more valuable of the two. Here's why.

Image source: Getty Images.

Microsoft is in a better position to benefit from opportunities related to artificial intelligence Artificial intelligence (AI) is a major growth opportunity in tech these days, and yet, neither of these tech companies is truly taking off because of it. Apple has been slow to roll out AI features on its iPhones, and Microsoft's Copilot assistant doesn't exactly have the best reputation.

But of the two, Microsoft looks to be in a better position. I've used Copilot regularly, and Microsoft lets users choose which chatbot to use for their queries. And Copilot can help users with day-to-day queries related to spreadsheets and Word documents, making the cost of upgrading to an AI-powered plan justifiable for businesses. It's just a matter of time before customers come around to that realization, but I'm confident that will happen. And when it does, Microsoft's growth rate could take off, and so too will the stock.

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Apple's stock is highly overvalued, and Microsoft still possesses some intriguing upside Apple's valuation is 25% higher than Microsoft's. It's not a huge gap, and one that I think will shrink and eventually disappear in the near future. Investors have piled into Apple as a safe-haven stock of late, but at 35 times earnings, it looks overpriced given the often sluggish and modest growth its business generates. Microsoft, by comparison, trading at 27 times its earnings, looks more reasonably valued and has been rising recently after posting strong quarterly results, and it could still have room to rise even higher.

Within the next 18 months, perhaps a whole lot sooner, I predict Microsoft will have a higher valuation than Apple. It has more upside and some exciting growth opportunities related to AI, while Apple may be due for a pullback given its inflated valuation. While both stocks can make for good long-term investments, Microsoft looks to be the far better buy right now.

Billionaire investor Bill Ackman runs Pershing Square Capital Management, a hedge fund that owns only about eight to 12 holdings at any given time. It's mostly focused on core U.S.-based, large-cap consumer-facing companies, but it currently holds three artificial intelligence (AI) stocks: Amazon (AMZN +4.58%), Microsoft (MSFT +4.93%), and Meta Platforms (META +6.02%).

These are all fairly new positions: The Amazon position is about a year old, the Meta position started at the end of 2025, and the Microsoft position was opened in early 2026. The fund previously held shares of Alphabet, but it closed out its position in the first quarter of 2026. At the time, Ackman said he wasn't betting against Google, but he needed capital to buy Microsoft, which he thought was a better deal.

Bill Ackman of Pershing Square Capital Management. Image source: Getty Images.

Out of these three stocks, Amazon looks like the best buy right now. Here's why.

Stacking up Amazon, Microsoft, and Meta Amazon, Microsoft, and Meta are three of the most valuable companies in the world. They're all heavily investing in AI right now, but they use it in different ways.

Amazon and Microsoft compete in cloud services, but have other uses, too: Amazon has developed an AI chip business that, as a stand-alone business, is one of the three largest chip businesses in the world, and Microsoft's Copilot large language model (LLM) is built into its Office applications. Meta's LLM, Llama, is used by developers to create AI applications and by advertisers to run marketing campaigns on Meta's family of social media apps.

Here's how these companies performed in their most recent quarters and how expensive their stocks are as of this writing:

CompanyTotal SalesSales GrowthOperating Income GrowthP/E RatioAmazon$201 B20%43%22Microsoft$90 B18%18%26Meta$61 B28%(8)%21 Data source: Amazon, Microsoft, and Meta quarterly reports, YCharts. Growth is year over year.

Amazon is the largest company in the world by revenue, eclipsing Microsoft and Meta by more than double, yet it's growing rapidly, in line with much younger and smaller companies. It's also highly profitable, and its stock looks cheap.

It had a fantastic quarter in nearly every way, driven by AI momentum. Revenue from its cloud business, Amazon Web Services (AWS), increased 37% year over year, a major acceleration and back to the kind of growth it was experiencing several years ago when it was less than half the size it is today. It added $4.6 billion in the first quarter alone, which is 80% more than its largest increase by rate, and it has a $496 billion backlog, a triple-digit increase over last year.

Amazon previously said it would target $200 billion in capital expenditures (capex) this year, and it upped that to $220 billion due to increases in the price of memory products. CEO Andy detailed how the capex cycle works, explaining that there are two cycles: data centers, which last for about 30 years, and the infrastructure, which has a five- or six-year cycle.

While data centers require investments two years before they can be monetized, the infrastructure can be monetized within six months, giving Amazon more leeway to invest according to demand. Management expects to break even after two or three years, giving it another three or so years of increasing cash flow before it starts the cycle again.

More than the fundamentals The market had been pricing Amazon sluggishly as doubts crept in about whether this spending could lead to better operating results. Jassy has been adamant from the very beginning that Amazon has a massive opportunity and would need to invest to capitalize on it.

As the results begin to stream in, he maintains the positive long-term outlook. Even with its capex spend this year, he said, "We will still not have enough capacity to meet all the demand we have in 2026. And I believe this dynamic will also be true in 2027, too."

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And no one should forget the rest of Amazon. AWS accounts for less than a quarter of the company's sales, although it represented 60% of operating income in the second quarter. E-commerce is still responsible for most of its sales, and Pershing Square notes its leading position and its "one-of-a-kind logistics network that fulfills over $700 billion in gross merchandise value annually." It also believes that the retail business can nearly double profitability through "higher-margin advertising revenue, network density, and automation initiatives."

Amazon is the dominant player in two fast-growing businesses, it's investing for success, and it's priced to buy. Ackman isn't leaving this opportunity on the table, and retail investors should consider it, too.

The "Magnificent Seven" stocks are some of the world's most influential, successful companies, but all hasn't been peachy-keen with this bunch so far this year. The only two companies outperforming the S&P 500 as of market close on July 29 are Apple and Alphabet, up 24.8% and 6.8%, respectively, compared to the S&P 500's 6.7%.

Part of the down year is investors looking for value in more niche industries (like memory hardware), and part of it is investors looking for value in other sectors because of worries about inflated big tech stock valuations.

In either case, if I had to choose one to load up on right now, it'd be Microsoft (MSFT +4.93%), but in that same breath, Tesla (TSLA +3.49%) is a stock I'm currently avoiding. Here's why.

Image source: The Motley Fool.

A staple that's here to stay As of market close on July 29, Microsoft's stock was down 17.4% year to date. However, after reporting its fiscal 2026 fourth-quarter (Q4) results, the stock surged 9.5% in after-hours trading. The reason mainly comes down to Microsoft's AI investments showing signs of paying off.

Microsoft took a lot of heat for its spending, but it has progress to show for it. Its cloud platform Azure surpassed $100 billion in revenue for the first time, total Microsoft Cloud revenue increased 27% year over year (YOY) to $214 billion, and Microsoft 365 Copilot (Microsoft's AI assistant) doubled its paid seats from the previous quarter to 30 million.

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Even when Microsoft's stock is having a rough patch, I never second-guess whether it'll bounce back because the company is too important to the global business world. It's the marquee enterprise business-to-business company, with millions of businesses relying on various software and hardware for their daily operations.

That doesn't make the company or stock invincible by any means, but it's a competitive moat few can match. As the company continues to invest in cloud computing and AI infrastructure, it should continue its stronghold on the industry.

Microsoft isn't completely off the hook with its high capital expenditure (capex) plans, but some AI progress is enough to buy it some more time with investors. And with the stock trading at around 23.7 times its earnings (the third-cheapest of the Magnificent Seven), the upside far outweighs the potential downside.

TSLA PE Ratio data by YCharts

Are the red flags worth the price? I'll start with the good news about Tesla. In Q2, it increased its revenue by 26% YOY to $28.2 billion and set a company vehicle delivery record, with deliveries up 25% YOY to 480,216. That's commendable, but the one issue is how Tesla managed to do it.

Tesla essentially swapped out profit for volume. Its operating income (profit from core operations) dropped 57% YOY; its operating margin was 1.4%; and its free cash flow turned negative, coming in at -$1.09 billion.

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The decline in profits and free cash flow isn't ideal, but it's not the end of the world. The main issue is when you couple it with Tesla's capital expenditures. To be fair, Tesla's $5.79 billion in capex in Q2 is nowhere near the $43 billion Microsoft spent, but it was 142% more than Q2 last year. It expects its 2026 capex to be around $25 billion.

The spending itself would be easier to justify if Tesla had a clearer roadmap for its non-car sales segments. Its two long-term growth projects -- robotaxis and humanoid robots -- are likely many years from commercial use and even more years away from making worthwhile contributions to Tesla's earnings.

Tesla's car business isn't enough to justify its valuation. Investors are buying into the company because of its ambitious plans, but at some point, there has to be enough tangible progress. This is especially true for a stock trading at 277 times its earnings. There's expensive, and then there's that.

It has a lot of grey area to clear up before I'd feel comfortable buying the stock.

Gil Luria, D.A. Davidson head of technology research, joins 'The Exchange' to discuss which stocks are best positioned to win the AI race.

© AdrianHancu / iStock Editorial via Getty Images

Amazon (NASDAQ: AMZN | AMZN Price Prediction) and Microsoft (NASDAQ: MSFT) each posted blowout quarters and jumped on the results. Both hyperscalers leaned hard on AI infrastructure, yet the shape of each beat differs. Amazon delivered its fastest AWS growth in 18 quarters. Microsoft crossed Azure’s first $100 billion year and 30 million Copilot seats. The reactions rhymed, but the businesses underneath diverge sharply.

AWS Reaccelerates While Azure Keeps Scaling Amazon reported EPS of $5.75 against a $1.8227 estimate on revenue of $200.61 billion, up 19.62% YoY. AWS grew 37% to $42.23 billion at a 39.4% operating margin. Andy Jassy told investors, “AWS is booming, growing 36.7% year-over-year in Q2, our fastest growth in 18 quarters, and our AI and Chips businesses each eclipsed run rates of more than $25 billion.” Advertising climbed 26% to $19.81 billion, and Prime shipped 40% more items same-day or overnight.

Microsoft posted EPS of $4.74 on revenue of $90.01 billion, up 17.75% YoY. Intelligent Cloud jumped 32% to $39.31 billion, Azure grew 43%, and commercial RPO reached $678 billion, up 84%. Satya Nadella framed it as “advancing the frontier on the cost-to-outcome curve.” More Personal Computing slipped 4%, a reminder that Windows and Xbox no longer drive the narrative.

Full Stack vs. Enterprise Focus Amazon is building a full stack: Trainium and Graviton silicon, Bedrock foundation models, Zoox robotaxis approved by NHTSA, roughly 400 Amazon Leo satellites, and Amazon Now delivery across 250-plus cities. Microsoft narrowed focus to Azure, Copilot, GitHub, and Dynamics, backed by a reworked OpenAI pact that commits $250 billion of Azure services and extends IP rights through 2032.

Lens Amazon Microsoft Core Bet Own silicon, retail, and logistics Enterprise cloud plus OpenAI Cloud Growth AWS +37% Azure +43% Key Vulnerability Thin retail margins, tariff exposure GPU depreciation, partner profit share The Next Test Is Capex Discipline Both are spending like utilities. Amazon burned $54.21 billion of capex in one quarter, up 68.44%, and TTM free cash flow flipped to negative $7.6 billion. Microsoft ran full-year capex to $115.95 billion, up 109.63% in Q4, and quarterly free cash flow fell 23.19% to $19.64 billion. Prediction markets lean bullish, with a 60.71 composite sentiment score on AMZN and 64.09 on MSFT. Watch whether AWS holds near a 39% margin and whether Azure’s GPU depreciation cycle starts to bite.

Why I Lean Amazon After This Quarter Amazon reads better here. Operating income jumped 43.24% YoY even as capex surged, and the AI and custom chips businesses are already each past a $25 billion run rate. AMZN’s trailing P/E of about 22 looks reasonable next to its reaccelerating cloud engine. Microsoft owns the enterprise stack, but heavier merchant GPU depreciation and OpenAI profit-sharing now press against its 46.8% operating margin. For steadier compounding and a 0.77% dividend, Microsoft screens as the more defensive profile. Coming out of this quarter, Amazon shows the stronger operational setup.

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This year has been a volatile one for Microsoft (MSFT +5.23%). The tech giant went on a sharp decline in the early part of 2026 as investors grew bearish on software stocks, and even a behemoth such as Microsoft wasn't spared. At one point, it was down well over 20%.

Recently, however, the company posted its fourth-quarter numbers, which sparked a revival. It's been surging over the past few days, and it's now back to around the levels where it started the year and is approaching $500. Could it be on its way to a new all-time high?

Image source: Getty Images.

Microsoft easily beat expectations in Q4 Last week, Microsoft reported fourth-quarter earnings that came in well ahead of analyst expectations. The company's revenue for the June quarter totaled $90 billion and rose 18% year over year, which was better than Wall Street projections of $87.6 billion. Its adjusted per-share profit of $4.74 was also well above the $4.24 expected by analysts.

Of key importance was also the growth rate in its cloud business, Azure. At 43%, that was a faster rate than the 40% growth it posted in the third quarter. Earlier this year, investors were growing concerned about Azure's slowing growth rate, but with that improving in Q4, investors have become bullish on the tech stock once again.

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Is Microsoft's stock still destined to rise higher? Microsoft's stock has been undervalued for much of the year, but it wasn't all that long ago that it looked a bit expensive; a year ago, it was trading at close to 40 times its trailing earnings. Now, with its value rising again, its price-to-earnings multiple is creeping up to around 27.

For long-term investors, the stock can still make for an excellent buy, but it's important to consider the valuation, as that could limit returns and even lead to losses, despite the business being a solid one. It's currently trading at a bit higher than the average S&P 500 stock (which trades at 25 times earnings), but the good news is that it's still not as expensive as it was last year.

Shares of Microsoft may continue to rise this year and even reach new all-time highs. Last year, they hit a peak of more than $553. This is a quality blue chip stock to hold for the long haul, given its dominance in the tech sector and how prevalent its products and services are throughout the corporate world.

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by Todd Bishop on Aug 3, 2026 at 10:38 amAugust 3, 2026 at 10:51 am

GeekWire Illustration Microsoft and Amazon both saw their stocks surge again Monday, riding a post-earnings tech wave across the stock market that pushed Amazon past $3 trillion in value for the first time.

The gains follow earnings reports last week in which both companies’ cloud platforms exceeded expectations. Microsoft said Azure grew 43%, passing $100 billion in annual revenue for the first time. Amazon said AWS grew 37%, its fastest pace in 18 quarters.

Microsoft and Amazon are now the world’s fourth and fifth most valuable companies, respectively. The three ahead of them (Nvidia, Alphabet and Apple) are all headquartered in the Bay Area, although each has sizeable engineering centers in the Seattle region.

Amazon rose 4.6% in intraday trading to $284.15 as of publication time, after touching an all-time high of $287.20 earlier in the session, giving it a market value of $3.06 trillion.

Microsoft climbed 5.2% to $488.97, worth $3.63 trillion. Its rally began Thursday, when it added nearly $450 billion in market value, the largest one-day gain by any company on record.

The rallies came despite AI spending plans that have unsettled investors for much of the year. Microsoft went into earnings near a one-year low, after a $357 billion wipeout to start the year.

It’s all still coming at a huge cost. Microsoft spent a record $41 billion on capital projects last quarter and told investors to expect more than $50 billion in the current quarter. Amazon raised its 2026 forecast to about $220 billion from $200 billion, citing rising memory chip prices.

In one sign of the impact of the spending, Microsoft’s free cash flow fell 23% last quarter. Amazon’s free cash flow turned negative for the first time since 2023.

But cloud growth and other signs of demand for AI seem to have appeased investors for now.

Amazon CEO Andy Jassy told investors the spending reflects unmet demand: “Even at that amount, we will still not have enough capacity to meet all the demand we have in 2026, and I believe this dynamic will also be true in 2027 too. In fact, the demand we already have for 2028 is striking.”

The gains come as both companies operate with fewer people. Amazon confirmed 16,000 more corporate job cuts in January, bringing the total to 30,000 since October, along with more recent reductions in its robotics and artificial general intelligence groups.

Microsoft cut 4,800 jobs in July, revamping its salesforce and overhauling Xbox.

Posted by Defense World Staff on Aug 3rd, 2026

Catalyst Capital Advisors LLC cut its holdings in shares of Microsoft Corporation (NASDAQ:MSFT – Free Report) by 17.7% in the 1st quarter, according to the company in its most recent disclosure with the Securities and Exchange Commission. The firm owned 9,789 shares of the software giant’s stock after selling 2,105 shares during the period. Catalyst Capital Advisors LLC’s holdings in Microsoft were worth $3,624,000 at the end of the most recent reporting period.

Other institutional investors and hedge funds have also added to or reduced their stakes in the company. Assetmark Inc. increased its position in Microsoft by 6.1% in the 1st quarter. Assetmark Inc. now owns 2,023,261 shares of the software giant’s stock valued at $748,951,000 after acquiring an additional 116,547 shares during the period. NovaPoint Capital LLC boosted its position in Microsoft by 6.5% during the 1st quarter. NovaPoint Capital LLC now owns 30,785 shares of the software giant’s stock worth $11,396,000 after acquiring an additional 1,889 shares during the period. PeakShares LLC boosted its position in Microsoft by 58.2% during the 1st quarter. PeakShares LLC now owns 4,412 shares of the software giant’s stock worth $1,633,000 after acquiring an additional 1,623 shares during the period. Paradigm Capital Management LLC NV grew its stake in shares of Microsoft by 23.4% in the first quarter. Paradigm Capital Management LLC NV now owns 6,160 shares of the software giant’s stock worth $2,280,000 after purchasing an additional 1,168 shares in the last quarter. Finally, Gallacher Capital Management LLC grew its stake in shares of Microsoft by 3.4% in the first quarter. Gallacher Capital Management LLC now owns 2,998 shares of the software giant’s stock worth $1,110,000 after purchasing an additional 98 shares in the last quarter. 71.13% of the stock is owned by institutional investors.

Microsoft Price Performance NASDAQ:MSFT opened at $464.72 on Monday. The business’s 50-day moving average price is $397.99 and its 200 day moving average price is $405.45. The firm has a market cap of $3.45 trillion, a P/E ratio of 25.88, a PEG ratio of 1.48 and a beta of 1.10. Microsoft Corporation has a 52-week low of $349.20 and a 52-week high of $555.45. The company has a quick ratio of 1.22, a current ratio of 1.23 and a debt-to-equity ratio of 0.07.

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 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 analysts’ expectations of $87.62 billion. During the same period in the previous year, the business earned $3.65 earnings per share. Microsoft’s revenue for the quarter was up 17.7% compared to the same quarter last year. As a group, sell-side analysts predict that Microsoft Corporation will post 19.53 earnings per share for the current fiscal year.

Microsoft Announces Dividend 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 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 presently 20.27%.

Wall Street Analysts Forecast Growth A number of equities research analysts recently weighed in on MSFT shares. Dbs Bank cut their price objective on shares of Microsoft from $678.00 to $573.00 in a research note on Thursday, May 7th. Wells Fargo & Company increased their target price on shares of Microsoft from $625.00 to $650.00 and gave the company an “overweight” rating in a research report on Thursday. BMO Capital Markets raised their target price on shares of Microsoft from $500.00 to $515.00 and gave the company an “outperform” rating in a research note on Thursday. DA Davidson restated a “buy” rating and set a $550.00 price target on shares of Microsoft in a research report on Thursday. Finally, Weiss Ratings reaffirmed a “hold (c)” rating on shares of Microsoft in a research note on Monday, July 6th. Forty-two analysts have rated the stock with a Buy rating and five have issued a Hold rating to the stock. According to data from MarketBeat, the company presently has a consensus rating of “Moderate Buy” and an average target price of $558.64.

Get Our Latest Analysis on Microsoft

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

Positive Sentiment: Azure growth exceeded expectations. Azure revenue increased 43% year over year, and annual Azure sales surpassed $100 billion for the first time. Management also guided to approximately 45% Azure growth in the next quarter, reinforcing confidence in Microsoft’s cloud and enterprise AI demand. Microsoft Shares Jump After Strong Outlook and Solid AI-Driven Growth Positive Sentiment: The earnings beat was substantial. Microsoft reported quarterly revenue of $90.01 billion and adjusted EPS of $4.74, above analyst estimates of $87.62 billion and $4.24, respectively. Net income reportedly rose 31%, while revenue increased about 18% year over year. Microsoft Q4 Earnings Beat Estimates as Cloud and AI Drive Results Positive Sentiment: AI monetization and financial discipline eased investor concerns. Microsoft 365 Copilot surpassed 30 million paid seats, its commercial remaining performance obligation reached $678 billion—up 84% year over year—and management held its capital-expenditure outlook broadly steady while emphasizing continued cash generation. Investors viewed this as a better balance between infrastructure investment and returns than some peers have demonstrated. Microsoft Eases AI Spending Concerns Neutral Sentiment: Analysts largely reaffirmed bullish views, with several price-target increases, although estimates remain wide. Microsoft’s stock is now trading well above its 50-day and 200-day moving averages after a historic rally, raising the possibility of increased volatility or profit-taking. Negative Sentiment: Microsoft continues to face risks from data-center power constraints, chip costs, regulatory scrutiny and the enormous scale of AI investment. A reported cloud-security flaw that could have exposed customers adds another operational concern. Cyber Firm Wiz Reports Microsoft Cloud Flaw Negative Sentiment: Several law firms publicized a securities class-action lawsuit concerning investors who purchased Microsoft shares between May 1, 2025, and January 28, 2026, with an August 11 lead-plaintiff deadline. Such announcements may create reputational and legal overhang, although they have not offset the earnings-driven optimism. Microsoft Securities Class Action Deadline Insider Buying and Selling In other Microsoft news, EVP Amy Coleman sold 1,262 shares of Microsoft stock in a transaction that occurred on Thursday, May 14th. The shares were sold at an average price of $411.34, for a total value of $519,111.08. Following the transaction, the executive vice president owned 46,003 shares in the company, valued at approximately $18,922,874.02. The trade was a 2.67% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which can be accessed through this hyperlink. Also, CEO Judson Althoff sold 15,500 shares of Microsoft stock in a transaction that occurred on Monday, June 1st. The stock was sold at an average price of $460.99, for a total transaction of $7,145,345.00. Following the completion of the transaction, the chief executive officer owned 110,477 shares in the company, valued at approximately $50,928,792.23. This trade represents a 12.30% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold 23,762 shares of company stock worth $10,508,361 in the last ninety days. 0.03% of the stock is currently owned by corporate insiders.

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).

See Also Five stocks we like better than Microsoft 3 Fixed-Income ETFs Show Why Yield Is Only Part of the Income Story AbbVie Quietly Solved Its Biggest Problem—Now What? Rio Tinto’s Results Make the Case for Looking Beyond Tech in the AI Trade Strategy’s Structural Strength: Hidden in a $8 Billion Illusion 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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« PREVIOUS HEADLINECopeland Capital Management LLC Buys 17,260 Shares of Microsoft Corporation $MSFT

Microsoft (MSFT +3.70%) has not performed well this year. Investors are worried that artificial intelligence (AI) will replace many of the company's services, a sentiment that has put downward pressure on much of the software industry. Meanwhile, the company's heavy investments in AI may lead to lower profits and margins, or so the argument goes. However, Microsoft proved some doubters wrong with its latest earnings report, for the fourth quarter of its fiscal year 2026, which ended on June 30.

The company's revenue increased by a healthy 18% year over year to $90 billion, and even with massive AI investments, adjusted earnings per share climbed 23% year over year to $4.74. Microsoft's stock soared by 15% following its quarterly update, but there is one key reason -- or several hundred billion -- why there may be more upside ahead. Here's what investors need to know.

Image source: The Motley Fool.

Microsoft Cloud for the win Microsoft's cloud computing business was, once again, the star of the show. Microsoft Cloud's sales jumped 27% year over year, while Azure revenue increased by 43%. This segment should continue driving growth for the foreseeable future. How do we know that? The company reported a cloud backlog of $678 billion as of the end of the quarter, up 84% year over year. This provides the tech leader with significant visibility into sustained demand and growth in its cloud business.

Also, Microsoft's AI-related investments are clearly having a positive impact on the business, even beyond driving meaningful cloud growth. Consider Microsoft Copilot, an AI assistant integrated across the company's apps and productivity suite that helps users automate tasks and improve productivity. Microsoft said that Microsoft 365 Copilot has 30 million paid seats (or active paid subscriptions), with net paid subscription adds more than doubling quarter over quarter.

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This provides further evidence that, rather than being replaced by AI, Microsoft is evolving with the technology by launching AI-powered services to make its customers' lives easier, and they are buying what the company is selling. Microsoft is dispelling some of the fears investors have had recently and showing that its long-term investment thesis remains strong. We haven't even touched on other aspects of the business, including its reliable income program and rock-solid balance sheet.

Despite all that, Microsoft's shares are still in the red this year, down 2% year to date as of writing. My view is that even with the massive post-earnings surge, there is still plenty of upside potential, given the tech leader's strong position in cloud computing, innovative abilities, significant free cash flow, and other aspects of the business that will enable it to pursue lucrative long-term opportunities.

NEW YORK, Aug. 03, 2026 (GLOBE NEWSWIRE) -- Levi & Korsinsky, LLP alerts investors in Microsoft Corporation (NASDAQ: MSFT) of a pending securities class action. Class Period: May 1, 2025 through January 28, 2026. Check if you can recover your investment losses or contact Joseph E. Levi, Esq. at [email protected] | (212) 363-7500.

Microsoft shares traded above $550 during the Class Period while the Company allegedly concealed material risks tied to multibillion-dollar AI partnerships. The Court has set August 11, 2026 as the deadline to apply for lead plaintiff appointment.

"Investors deserve transparency about material risks that could affect their investments. When a company commits tens of billions of dollars to partnerships structured so that investment dollars flow back as revenue, shareholders are entitled to understand the circularity and concentration risks involved." -- Joseph E. Levi, Esq.

The Alleged OpenAI and Anthropic Concentration Risk

The lawsuit asserts that management repeatedly downplayed concerns about the structure and risk profile of Microsoft's AI investment strategy. Microsoft invested over $13 billion in OpenAI and committed up to $5 billion in Anthropic, while simultaneously entering arrangements where those same partners committed to purchasing hundreds of billions in Azure services and compute capacity.

As alleged, this created a circular dynamic that defendants failed to adequately disclose, while also concealing significant problems with Copilot product quality, user adoption, and competitive positioning.

How Circular Arrangements Allegedly Inflated Growth Metrics

OpenAI contracted to purchase $250 billion in incremental Azure services, while Microsoft retained a 27% stake valued at $135 billionAnthropic committed to $30 billion of Azure compute capacity plus up to one gigawatt of additional capacity as part of a deal where Microsoft invested up to $5 billionManagement cited Azure revenue growth of 33% to 40% during the Class Period as evidence of organic AI demand without adequately disclosing how much was tied to these reciprocal arrangementsThe action claims defendants failed to disclose the concentration risk of depending on a small number of LLM partners for a significant portion of Azure's AI-driven growthNVIDIA was also part of the Anthropic partnership structure, adding further interdependency across the AI investment ecosystemThe Company planned to increase total AI capacity by 80% and roughly double its total data center footprint over two years based on what the lawsuit contends were overstated demand signals Why AI Capital Expenditure Returns Allegedly Mattered to Investors

The securities action claims that management represented Microsoft was "well positioned to achieve suitable returns on its AI-related investments" while failing to disclose significant technical, organizational, and adoption problems with its Copilot products that undermined those representations. Investors who purchased MSFT shares during the Class Period allegedly did so at prices inflated by these undisclosed risks.

Speak with an attorney about recovering damages or call (212) 363-7500.

WHY LEVI & KORSINSKY -- Ranked in ISS Securities Class Action Services' Top 50 Report for seven consecutive years, Levi & Korsinsky, LLP is a nationally recognized leader in shareholder rights litigation. With a team of over 70 professionals, the firm has recovered hundreds of millions of dollars for investors.

Frequently Asked Questions About the MSFT Lawsuit

Q: Who is eligible to join the MSFT investor lawsuit? A: Investors who purchased MSFT stock or securities between May 1, 2025 and January 28, 2026 and suffered financial losses may be eligible. Eligibility is based on purchase date and documented losses, not on whether you still hold the shares.

Q: What specific misstatements does the MSFT lawsuit allege? A: The complaint alleges Microsoft made materially false or misleading statements regarding the success and adoption of its AI initiatives, including the Copilot product family and Azure cloud platform, while failing to disclose significant technical, organizational, and interoperability problems affecting Copilot, as well as the diversion of computing capacity away from Azure to fix those problems. When the true state was revealed, the stock price declined sharply.

Q: What do MSFT investors need to do right now? A: Gather brokerage records including purchase dates, share quantities, and prices paid. Contact Levi & Korsinsky for a free, no-obligation evaluation at [email protected] or (212) 363-7500. No immediate action is required to remain eligible as a class member.

Q: What is a lead plaintiff and why does it matter? A: A lead plaintiff is the investor appointed by the court to represent the entire class. Lead plaintiffs are typically investors with the largest documented losses. Being appointed does not increase individual recovery but gives direct oversight of how the case is run.

Q: What if I already sold my MSFT shares -- can I still recover losses? A: Yes. Eligibility is based on when you purchased, not whether you still hold them. Investors who bought during the class period and sold at a loss may still participate.

Q: What does it cost me to participate? A: Nothing. Securities class actions are handled on a pure contingency basis. No upfront fees, no retainer, no out-of-pocket costs.

Q: How long will the lawsuit take to resolve? A: Securities class actions typically take two to four years from initial filing to resolution.

CONTACT:

Levi & Korsinsky, LLP
Joseph E. Levi, Esq.
Ed Korsinsky, Esq.
33 Whitehall Street, 27th Floor
New York, NY 10004
[email protected]
Tel: (212) 363-7500
Fax: (212) 363-7171

Posted by Defense World Staff on Aug 3rd, 2026

Bartlett & CO. Wealth Management LLC boosted its stake in Microsoft Corporation (NASDAQ:MSFT – Free Report) by 1.0% in the 1st quarter, according to the company in its most recent 13F filing with the Securities & Exchange Commission. The firm owned 984,801 shares of the software giant’s stock after purchasing an additional 9,918 shares during the quarter. Microsoft makes up 4.8% of Bartlett & CO. Wealth Management LLC’s investment portfolio, making the stock its 3rd largest position. Bartlett & CO. Wealth Management LLC’s holdings in Microsoft were worth $364,544,000 as of its most recent filing with the Securities & Exchange Commission.

Other hedge funds and other institutional investors have also recently modified their holdings of the company. MTM Investment Management LLC boosted its position in shares of Microsoft by 2.0% in the first quarter. MTM Investment Management LLC now owns 18,152 shares of the software giant’s stock valued at $6,719,000 after acquiring an additional 362 shares during the period. Ranch Capital Advisors Inc. increased its holdings in Microsoft by 0.8% during the 1st quarter. Ranch Capital Advisors Inc. now owns 17,620 shares of the software giant’s stock worth $6,522,000 after acquiring an additional 140 shares during the period. Kesler Norman & Wride LLC increased its holdings in Microsoft by 0.7% during the 1st quarter. Kesler Norman & Wride LLC now owns 35,800 shares of the software giant’s stock worth $13,252,000 after acquiring an additional 240 shares during the period. Heartland Bank & Trust Co lifted its stake in Microsoft by 38.9% in the 1st quarter. Heartland Bank & Trust Co now owns 39,675 shares of the software giant’s stock worth $14,686,000 after purchasing an additional 11,113 shares in the last quarter. Finally, Zhang Financial LLC lifted its stake in Microsoft by 8.1% in the 1st quarter. Zhang Financial LLC now owns 73,448 shares of the software giant’s stock worth $27,188,000 after purchasing an additional 5,520 shares in the last quarter. 71.13% of the stock is currently owned by institutional investors.

Microsoft Price Performance Shares of Microsoft stock opened at $464.72 on Monday. 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 Corporation has a 52-week low of $349.20 and a 52-week high of $555.45. The company has a fifty day moving average of $397.99 and a 200-day moving average of $405.45. The stock has a market capitalization of $3.45 trillion, a price-to-earnings ratio of 25.88, a price-to-earnings-growth ratio of 1.48 and a beta of 1.10.

Microsoft (NASDAQ:MSFT – Get Free Report) last issued its 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 company had revenue of $90.01 billion for the quarter, compared to analysts’ expectations of $87.62 billion. Microsoft had a net margin of 40.31% and a return on equity of 31.98%. The firm’s revenue was up 17.7% compared to the same quarter last year. During the same quarter last year, the company earned $3.65 EPS. Equities research analysts expect that Microsoft Corporation will post 19.53 EPS for the current year.

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

Insider Transactions at Microsoft In other news, EVP Amy Coleman sold 1,262 shares of the business’s stock in a transaction dated Thursday, May 14th. The stock was sold at an average price of $411.34, for a total value of $519,111.08. Following the completion of the sale, the executive vice president owned 46,003 shares of the company’s stock, valued at approximately $18,922,874.02. The trade was a 2.67% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is accessible through this link. Also, EVP Takeshi Numoto sold 4,500 shares of the stock in a transaction dated Wednesday, June 10th. The shares were sold at an average price of $402.84, for a total value of $1,812,780.00. Following the sale, the executive vice president owned 47,468 shares of the company’s stock, valued at $19,122,009.12. This represents a 8.66% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Over the last quarter, insiders have sold 23,762 shares of company stock worth $10,508,361. Company insiders own 0.03% of the company’s stock.

Analyst Upgrades and Downgrades Several equities analysts recently commented on MSFT shares. Benchmark restated a “buy” rating on shares of Microsoft in a research report on Friday, July 24th. Raymond James Financial cut Microsoft from a “market perform” rating to a “market perform” rating in a report on Tuesday, May 5th. Deutsche Bank Aktiengesellschaft reiterated a “buy” rating on shares of Microsoft in a research report on Monday, July 20th. Dbs Bank decreased their price objective on shares of Microsoft from $678.00 to $573.00 in a research report on Thursday, May 7th. Finally, BNP Paribas Exane decreased their price objective on shares of Microsoft from $556.00 to $555.00 and set an “outperform” rating on the stock in a research report on Friday, May 1st. Forty-two research analysts have rated the stock with a Buy rating and five have issued a Hold rating to the company. According to data from MarketBeat.com, the stock presently has an average rating of “Moderate Buy” and a consensus target price of $558.64.

View Our Latest Stock Report on MSFT

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

Positive Sentiment: Azure growth exceeded expectations. Azure revenue increased 43% year over year, and annual Azure sales surpassed $100 billion for the first time. Management also guided to approximately 45% Azure growth in the next quarter, reinforcing confidence in Microsoft’s cloud and enterprise AI demand. Microsoft Shares Jump After Strong Outlook and Solid AI-Driven Growth Positive Sentiment: The earnings beat was substantial. Microsoft reported quarterly revenue of $90.01 billion and adjusted EPS of $4.74, above analyst estimates of $87.62 billion and $4.24, respectively. Net income reportedly rose 31%, while revenue increased about 18% year over year. Microsoft Q4 Earnings Beat Estimates as Cloud and AI Drive Results Positive Sentiment: AI monetization and financial discipline eased investor concerns. Microsoft 365 Copilot surpassed 30 million paid seats, its commercial remaining performance obligation reached $678 billion—up 84% year over year—and management held its capital-expenditure outlook broadly steady while emphasizing continued cash generation. Investors viewed this as a better balance between infrastructure investment and returns than some peers have demonstrated. Microsoft Eases AI Spending Concerns Neutral Sentiment: Analysts largely reaffirmed bullish views, with several price-target increases, although estimates remain wide. Microsoft’s stock is now trading well above its 50-day and 200-day moving averages after a historic rally, raising the possibility of increased volatility or profit-taking. Negative Sentiment: Microsoft continues to face risks from data-center power constraints, chip costs, regulatory scrutiny and the enormous scale of AI investment. A reported cloud-security flaw that could have exposed customers adds another operational concern. Cyber Firm Wiz Reports Microsoft Cloud Flaw Negative Sentiment: Several law firms publicized a securities class-action lawsuit concerning investors who purchased Microsoft shares between May 1, 2025, and January 28, 2026, with an August 11 lead-plaintiff deadline. Such announcements may create reputational and legal overhang, although they have not offset the earnings-driven optimism. Microsoft Securities Class Action Deadline 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 3 Fixed-Income ETFs Show Why Yield Is Only Part of the Income Story AbbVie Quietly Solved Its Biggest Problem—Now What? Rio Tinto’s Results Make the Case for Looking Beyond Tech in the AI Trade Strategy’s Structural Strength: Hidden in a $8 Billion Illusion

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« PREVIOUS HEADLINEFAS Wealth Partners Inc. Has $4.03 Million Position in The Boeing Company $BA

Space Exploration Technologies, which operates in the space transportation, satellite internet connectivity, and artificial intelligence (AI) infrastructure industries, went public on June 12. Its stock quickly rallied to a peak of $225, but it has since lost half of its value and closed at just over $108 on Friday, July 31.

But SpaceX still has a hefty market capitalization of $1.43 trillion. Since the company generated just $19.3 billion in revenue over the last four quarters, its stock remains at a sky-high price-to-sales ratio of 74, making it almost 12 times as expensive as the Nasdaq-100 technology index.

That means more downside could be ahead, which is why if I had $1,000 to invest today, I'd look elsewhere. Here's why I think Microsoft (MSFT +3.02%) will perform significantly better over the long term.

Image source: Getty Images.

Azure is growing at an accelerated pace Azure is Microsoft's cloud computing platform, and offers hundreds of services to help businesses thrive in the digital era, whether they need simple data storage or complex software development tools. But it has also become a leading distribution platform for all of the tools enterprises need to develop and deploy AI software, and this is driving a new phase of revenue growth.

Running AI software requires a substantial amount of computing power, which is typically delivered by data centers, which house thousands of specialized chips called graphics processing units (GPUs). Most businesses don't have billions of dollars to build this infrastructure themselves, so they instead rent it from providers like Azure and only pay for what they use.

Microsoft ended its 2026 fiscal year (which wrapped up on June 30) with a staggering $678 billion order backlog from customers who were waiting for Azure to bring more data center capacity online, an 84% year-over-year increase. The company built 88 new data centers worldwide over the last 12 months as part of a two-year plan to double its infrastructure footprint, but it will have to continue building aggressively if it wants to convert that massive backlog into revenue.

Azure offers a platform called Foundry that makes it easy to combine data center compute with a selection of over 11,000 ready-made large language models (LLMs) from leading developers like OpenAI. This gives businesses plenty of options for rapidly building AI agents, AI chatbots, and other AI software applications.

Azure's total annual revenue surpassed $100 billion for the first time in fiscal 2026, and in the fourth quarter, the platform posted a whopping 43% year-over-year growth. It was the second consecutive quarter in which that growth rate accelerated, highlighting the cloud provider's incredible momentum.

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Copilot for 365 has a record number of enterprise users Microsoft is also kicking major AI-related goals outside of Azure. The company has been integrating its Copilot virtual assistant into legacy software products like Windows, Bing, Edge, and the 365 productivity suite (which includes Word, Excel, and PowerPoint), where it's experiencing rapid uptake.

As of June 30, companies all over the world were paying for 30 million Copilot for 365 licenses, which was a 50% increase from March 31, just three months earlier. But that represents a mere fraction of the opportunity at hand, because companies pay for over 400 million 365 licenses for their employees, and all of them are candidates for the Copilot upgrade. In other words, Copilot could bring in billions of dollars in annual revenue as adoption ramps up -- and that's just from 365 alone.

By using its existing portfolio of software products to sell Copilot, Microsoft has a massive advantage over pure-play AI companies like OpenAI and Anthropic, which have to acquire customers from scratch.

Microsoft stock trades at an attractive price Microsoft stock soared by 15% on July 30, the first trading day after it reported its fiscal 2026 results. Nevertheless, based on the company's annual earnings of $17.65 per share, its stock is still trading at an attractive price-to-earnings (P/E) ratio of just 25.1. That's a 21% discount to its five-year average of 32.3.

Data by YCharts.

Microsoft is also much cheaper than the Nasdaq-100 index, which has a P/E ratio of 33.1. That suggests it's probably still undervalued compared to a basket of its big-tech peers. Moreover, with a price-to-sales ratio of 10.1, Microsoft is dramatically cheaper than SpaceX.

As a result, even after its recent rally, I still think Microsoft stock has significantly more upside potential than SpaceX from here.