- Stifel analyst Brad Reback upgraded Microsoft to buy from hold and lifted his price target to $575 from $530, implying roughly 15% upside from the prior close. Reback points to mid-to-upper-teens revenue growth from Azure and Copilot, stable operating margins, and strong cash flow that limits the need for outside financing.
- The upgrade removes one of the few remaining hold ratings on Microsoft: 68 of the roughly 71 firms tracked by Bloomberg recommend buying the stock, about 96%, with no sell ratings. LSEG data shows 57 of 60 covering analysts at buy or strong buy.
- Microsoft shares have stalled in 2026, up less than 5% versus a 21% gain for the Nasdaq 100, as investors questioned heavy AI capital spending on Azure and Copilot. The late-July quarter showed the fastest cloud-computing growth in four years and produced the stock's biggest one-day jump since October 2008.
- BNP Paribas analyst Stefan Slowinski reiterated a bullish view with a $549 price target, arguing Azure's planned higher prices on renewing contracts are a meaningful growth lever not yet in reported results, with the price tailwind still to come after capacity-driven growth. Goldman Sachs carries a buy rating and $640 target, citing Microsoft's AI strategy entering a monetization phase.
Quotes
“We are increasingly comfortable with the company's ability to sustain mid/upper teens revenue growth as open-weight model advancement has boosted management's [large language model] agnostic strategy (Azure & Copilot)”
“clearly turned the corner”
“higher prices on renewing contracts”
“significant tailwind from price increases is still to come”