Melius Research Downgrades Microsoft (NASDAQ:MSFT) to Hold

Microsoft (NASDAQ:MSFT) was downgraded by research analysts at Melius Research from a “buy” rating to a “hold” rating in a research note issued to investors on Monday.

Other analysts have also issued research reports about the stock. New Street Research lifted their price objective on shares of Microsoft from $670.00 to $675.00 and gave the stock a “buy” rating in a research report on Thursday, January 29th. HSBC lowered their price target on shares of Microsoft from $667.00 to $588.00 and set a “buy” rating on the stock in a report on Thursday, January 29th. Guggenheim reissued a “buy” rating and set a $586.00 price objective on shares of Microsoft in a report on Thursday, January 22nd. Oppenheimer restated an “outperform” rating on shares of Microsoft in a research note on Thursday, January 29th. Finally, Piper Sandler reiterated an “overweight” rating and set a $600.00 price target (down previously from $650.00) on shares of Microsoft in a research note on Thursday, January 29th. Two research analysts have rated the stock with a Strong Buy rating, thirty-nine have given a Buy rating and four have assigned a Hold rating to the company’s stock. According to MarketBeat.com, the stock has a consensus rating of “Moderate Buy” and a consensus target price of $596.95.

Microsoft Stock Performance

Shares of Microsoft stock traded up $8.99 during mid-day trading on Monday, hitting $410.13. 6,939,951 shares of the stock were exchanged, compared to its average volume of 36,792,461. Microsoft has a 12 month low of $344.79 and a 12 month high of $555.45. The company has a 50-day simple moving average of $468.42 and a 200 day simple moving average of $496.10. The company has a market capitalization of $3.05 trillion, a P/E ratio of 25.56, a P/E/G ratio of 1.57 and a beta of 1.08. The company has a debt-to-equity ratio of 0.09, a quick ratio of 1.38 and a current ratio of 1.39.

Microsoft (NASDAQ:MSFT) last issued its quarterly earnings results on Wednesday, January 28th. The software giant reported $4.14 EPS for the quarter, topping analysts’ consensus estimates of $3.86 by $0.28. Microsoft had a return on equity of 32.34% and a net margin of 39.04%.The business had revenue of $81.27 billion for the quarter, compared to analyst estimates of $80.28 billion. During the same period last year, the company posted $3.23 earnings per share. Microsoft’s quarterly revenue was up 16.7% compared to the same quarter last year. Sell-side analysts anticipate that Microsoft will post 13.08 earnings per share for the current fiscal year.

Insiders Place Their Bets

In other Microsoft news, CEO Judson Althoff sold 12,750 shares of the company’s stock in a transaction dated Tuesday, December 2nd. The stock was sold at an average price of $491.52, for a total value of $6,266,880.00. Following the transaction, the chief executive officer directly owned 129,349 shares in the company, valued at $63,577,620.48. This represents a 8.97% decrease in their position. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is available through this hyperlink. Also, EVP Takeshi Numoto sold 2,850 shares of the company’s stock in a transaction that occurred on Thursday, December 4th. The stock was sold at an average price of $478.72, for a total transaction of $1,364,352.00. Following the completion of the transaction, the executive vice president owned 55,782 shares in the company, valued at approximately $26,703,959.04. This trade represents a 4.86% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. 0.03% of the stock is owned by insiders.

Institutional Trading of Microsoft

Several hedge funds and other institutional investors have recently bought and sold shares of the company. Darden Wealth Group Inc lifted its stake in Microsoft by 3.9% in the fourth quarter. Darden Wealth Group Inc now owns 18,536 shares of the software giant’s stock worth $8,965,000 after purchasing an additional 695 shares during the last quarter. General Pension Society PZU Joint Stock Co boosted its holdings in Microsoft by 52.4% during the 4th quarter. General Pension Society PZU Joint Stock Co now owns 74,200 shares of the software giant’s stock valued at $35,885,000 after acquiring an additional 25,500 shares during the period. Tiff Advisory Services LLC grew its position in Microsoft by 334.8% during the 4th quarter. Tiff Advisory Services LLC now owns 42,311 shares of the software giant’s stock worth $20,462,000 after acquiring an additional 32,579 shares during the last quarter. Coldstream Capital Management Inc. increased its stake in Microsoft by 53.9% in the 4th quarter. Coldstream Capital Management Inc. now owns 789,112 shares of the software giant’s stock worth $381,630,000 after purchasing an additional 276,520 shares during the period. Finally, Life Cycle Investment Partners Ltd bought a new stake in Microsoft in the fourth quarter valued at approximately $1,033,240,000. Hedge funds and other institutional investors own 71.13% of the company’s stock.

Key Microsoft News

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Barclays reiterated a “Buy” on MSFT, reaffirming institutional support that can stabilize sentiment after last week’s tech weakness. Microsoft Corp: Barclays Gives a Buy Rating
• Positive Sentiment: Many Wall Street firms still rate MSFT a buy and the recent Quiver summary shows a wide range of bullish price targets (median around $600), providing a potential upside anchor for the stock. Microsoft Stock (MSFT) Opinions on Stifel Downgrade
• Positive Sentiment: Multiple analyst and research pieces highlight Azure and AI‑driven revenue (including Copilot and cloud demand) as the core growth engine supporting margins and long‑term earnings. Those fundamentals underpin investor conviction despite near‑term noise. AI Eating Software Is Just Wrong; Let’s Look At Microsoft
• Neutral Sentiment: Big‑tech momentum is moderating after a week that erased roughly $1 trillion from the group; Microsoft is moving largely with the sector rather than on idiosyncratic news. That keeps trading range dynamics in play. Big Tech stocks are treading water after $1 trillion sell-off week
• Neutral Sentiment: Third‑party integrations (e.g., a press release about Abaxx delivering market data into Microsoft Excel) highlight ongoing ecosystem demand for Excel/Office capabilities but are low impact for MSFT’s market valuation. Abaxx Exchange Partners with ipushpull to Deliver Real-Time Market Data Directly into Microsoft Excel
• Negative Sentiment: A Stifel downgrade to “Hold” with a $392 target sparked a sharp short‑term selloff and amplified concerns about AI capex versus near‑term growth — a reminder that bearish research can trigger outsized moves in large caps. Microsoft Stock (MSFT) Opinions on Stifel Downgrade
• Negative Sentiment: Fresh reports of insider sales (multiple senior executives have sold shares recently) and some hedge‑fund stake reductions have added to headline risk and may weigh on sentiment until earnings/catalysts reassert fundamentals. Microsoft Stock (MSFT) Opinions on Stifel Downgrade
• Negative Sentiment: Broader software/AI sector volatility — including recent reports of a software bear market and rotation out of last year’s winners — keeps downside risk elevated despite MSFT’s strong metrics. Software Bear Market: 3 Stocks With 47% to 63% Upside, According to Wall Street

About Microsoft

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).