Microsoft Corporation (MSFT) Price Target: Is It Set To Rise Or Fall In Price?

Microsoft Corporation (NASDAQ:MSFT) finished Tuesday with an addition of $5.65 to close at $288.76, an upside of 2.00 percent. An average of 29,025,420 shares of common stock have been traded in the last five days. There was a gain of $5.24 in the past week. The last 20 days have seen an average of 26,107,520 shares traded, while the 50-day average volume stands at 22,739,387.

MSFT stock has decreased by -4.11% in the last month. The company shares reached their 1-month lowest point of $280.25 on 10/04/21. With the stock rallying to its 52-week high on 08/20/21, shares of the company touched a low of $199.62 and a high of $305.84 in 52 weeks. In spite of this, the price is down -5.58% from the 52-week high.


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Insider Transactions

26 days have passed since Microsoft Corporation (MSFT) last reported insider trading activity. Hogan Kathleen T, who is EVP, Human Resources, most recently acquired $20,000 shares at $298.68 per share on Sep 10. In this transaction, the insider spent $5,973,540. EVP, Chief Marketing Officer, Capossela Christopher C, disposed of 10,000 shares at a price of $298.82 on Sep 10. The insider now owns more than $2,988,176 worth of shares. Prior to that, Chief Executive Officer Nadella Satya went on to Sale 75,573 shares at $303.28 each on Sep 01. An amount of $22,920,037 was transacted.

Valuation Metrics

Microsoft Corporation (MSFT) has a trailing price-to-earnings (P/E) ratio of 35.85, which compares with the 29.20 for the broader industry and 36.42 for the sector. This means investors are optimistic about the stock’s future prospects. In the last five years, Microsoft Corporation’s PE ratio has ranged between 62.43 and 22.35. The stock’s beta is 0.80. Other valuation ratios to consider include the trailing price-to-sales (P/S) ratio at 12.59, the price-to-book (PB) ratio at 15.30, and the price-to-cash flow ratio at 53.44.

Microsoft Corporation will next go ex-dividend on 17-Nov-2021. The next dividend payment Microsoft Corporation will make is expected to be $0.62.

The quick ratio of Microsoft Corporation for the three months ended June 29 was 2.10, and the current ratio was 2.10, indicating that the company is able to meet its debt obligations. Further, the company has a long term debt to equity ratio of 0.44 and a total debt to equity ratio of 0.50 for the quarter ending June 29. On the profitability front, the trailing 12-month gross margin is 68.90% against a 5-year average of 66.5%. Microsoft Corporation’s EBITDA margin for the year ending June 29 is 48.08%, while its operating margin for the same period stands at 41.60%. Its gross profit as reported stood at $115.86 billion compared to revenue of $168.09 billion.

For investors, determining the potential profitability of the investment also depends on the performance of the company’s management. In the past 12 months, Microsoft Corporation’s return on assets was 19.60%, compared to 13.3% over the last five years. In the past year, the return on investment has been 28.20%, and the 5-year average is 21.2%. Meanwhile, the return on equity (ROE) for the past 12 months has been 46.20% and the 5-year average holds at 36.2%. For the broader industry, ROE averaged 3.34 over the past year.

Technical Picture

From a technical analysis perspective, let’s take a brief look at Microsoft Corporation (MSFT) price momentum. RSI 9-day as of the close on 05 October was 45.24%, suggesting the stock is Neutral, with historical volatility in this time frame at 29.16%.

As of today, MSFT’s price is $285.38 +1.85% or $5.24 from its 5-day moving average. MSFT is currently trading -3.80% lower than its 20-day SMA and +18.82% higher than its 100-day SMA. However, the stock’s current price level is -0.10% below the SMA50 and +31.60% above the SMA200.

The stochastic %K and %D were 25.96% and 18.04%, respectively, and the average true range (ATR) was 6.26. With the 14-day stochastic at 33.96% and the average true range at 5.73, the RSI (14) stands at 45.24%. The stock has reached -2.29 on the 9-day MACD Oscillator while the 14-day reading was at -5.60.

Analyst Ratings

The consensus rating for Microsoft Corporation (MSFT) among analysts is Buy. According to current brokerage recommendations, 0 brokerage firms advise that investors sell MSFT, while 2 suggest investors hold. There are 0 analysts who rate the stock as underweight. The stock is rated overweight by 3 analysts, while 32 others rate it as a “buy”.

What is MSFT’s price target for the next 12 months?

Analysts predict a range of price targets between $280.00 and $411.00, with a median target of $330.50. Taking a look at these predictions, the average price target given by analysts for Microsoft Corporation (MSFT) stock is $333.49.

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