Zacks Investment Research Lowers Microsoft Corporation (MSFT) to Hold

Zacks Investment Research lowered shares of Microsoft Corporation (NASDAQ:MSFT) from a buy rating to a hold rating in a report released on Friday morning.

According to Zacks, “Microsoft reported impressive first-quarter fiscal 2018 results driven by rapid adoption of Azure and Office 365. We expect these to remain the key catalysts in the near future. This along with lower spending will drive operating margin expansion in fiscal 2018. We believe that collaborations with the likes of Amazon.com, Red Hat, Symantec, Cray and PAREXEL are positive for the company's growth prospects. Microsoft recently launched Xbox One X with a strong game line-up. Considering the record pre-orders, we believe that the latest console has significant growth potential. However, intense competition from Sony’s PS4 is a major headwind. Additionally, declining PC shipments doesn't bode well for the company. Microsoft has underperformed the industry it belongs to on a year-to-date basis.”

Several other research analysts have also issued reports on the company. ValuEngine upgraded Microsoft Corporation from a hold rating to a buy rating in a research note on Wednesday, September 6th. Morningstar, Inc. reiterated a neutral rating on shares of Microsoft Corporation in a research note on Monday, October 16th. Credit Suisse Group reiterated an outperform rating on shares of Microsoft Corporation in a research note on Thursday, August 31st. KeyCorp reiterated a buy rating and set a $82.00 price objective on shares of Microsoft Corporation in a research note on Sunday, September 10th. Finally, Royal Bank Of Canada restated an outperform rating and set a $88.00 target price (up previously from $85.00) on shares of Microsoft Corporation in a report on Friday, October 27th. Two investment analysts have rated the stock with a sell rating, ten have issued a hold rating and thirty have issued a buy rating to the company’s stock. Microsoft Corporation currently has a consensus rating of Buy and a consensus price target of $83.86.

Microsoft Corporation (NASDAQ:MSFT) traded down $0.25 during trading on Friday, reaching $83.68. The company’s stock had a trading volume of 7,959,231 shares, compared to its average volume of 22,458,014. The company has a quick ratio of 3.06, a current ratio of 3.12 and a debt-to-equity ratio of 0.91. Microsoft Corporation has a 1 year low of $57.28 and a 1 year high of $86.20. The firm has a market capitalization of $644,480.00, a price-to-earnings ratio of 24.81, a P/E/G ratio of 1.96 and a beta of 1.01.

Microsoft Corporation (NASDAQ:MSFT) last released its quarterly earnings data on Thursday, October 26th. The software giant reported $0.84 earnings per share (EPS) for the quarter, topping the consensus estimate of $0.72 by $0.12. Microsoft Corporation had a return on equity of 35.23% and a net margin of 24.56%. The firm had revenue of $24.50 billion during the quarter, compared to analyst estimates of $23.57 billion. During the same period in the prior year, the company posted $0.76 earnings per share. The business’s revenue for the quarter was up 11.7% compared to the same quarter last year. sell-side analysts forecast that Microsoft Corporation will post 3.37 EPS for the current fiscal year.

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The firm also recently announced a quarterly dividend, which will be paid on Thursday, December 14th. Stockholders of record on Thursday, November 16th will be paid a dividend of $0.42 per share. This is an increase from Microsoft Corporation’s previous quarterly dividend of $0.39. This represents a $1.68 annualized dividend and a dividend yield of 2.01%. The ex-dividend date of this dividend is Wednesday, November 15th. Microsoft Corporation’s payout ratio is currently 52.70%.

In other news, CFO Amy Hood sold 55,000 shares of Microsoft Corporation stock in a transaction that occurred on Tuesday, August 29th. The stock was sold at an average price of $72.71, for a total transaction of $3,999,050.00. Following the completion of the transaction, the chief financial officer now directly owns 510,217 shares in the company, valued at approximately $37,097,878.07. The sale was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Also, insider Jean Philippe Courtois sold 26,763 shares of Microsoft Corporation stock in a transaction that occurred on Wednesday, August 30th. The stock was sold at an average price of $74.00, for a total value of $1,980,462.00. Following the transaction, the insider now owns 537,519 shares of the company’s stock, valued at $39,776,406. The disclosure for this sale can be found here. Insiders have sold a total of 100,763 shares of company stock valued at $7,574,552 over the last quarter. 1.49% of the stock is currently owned by corporate insiders.

A number of institutional investors and hedge funds have recently added to or reduced their stakes in the stock. New Capital Management LP boosted its stake in Microsoft Corporation by 0.5% in the 1st quarter. New Capital Management LP now owns 4,305 shares of the software giant’s stock valued at $284,000 after purchasing an additional 22 shares during the period. Nottingham Advisors Inc. boosted its stake in Microsoft Corporation by 0.4% in the 2nd quarter. Nottingham Advisors Inc. now owns 5,399 shares of the software giant’s stock valued at $372,000 after purchasing an additional 22 shares during the period. American Economic Planning Group Inc. ADV boosted its stake in Microsoft Corporation by 0.5% in the 2nd quarter. American Economic Planning Group Inc. ADV now owns 4,939 shares of the software giant’s stock valued at $340,000 after purchasing an additional 23 shares during the period. Carderock Capital Management Inc. boosted its stake in Microsoft Corporation by 0.7% in the 2nd quarter. Carderock Capital Management Inc. now owns 3,981 shares of the software giant’s stock valued at $274,000 after purchasing an additional 26 shares during the period. Finally, Appropriate Balance Financial Services Inc. boosted its stake in Microsoft Corporation by 4.7% in the 2nd quarter. Appropriate Balance Financial Services Inc. now owns 643 shares of the software giant’s stock valued at $9,331,000 after purchasing an additional 29 shares during the period. Institutional investors and hedge funds own 73.37% of the company’s stock.

About Microsoft Corporation

Microsoft Corporation is a technology company. The Company develops, licenses, and supports a range of software products, services and devices. The Company’s segments include Productivity and Business Processes, Intelligent Cloud and More Personal Computing. The Company’s products include operating systems; cross-device productivity applications; server applications; business solution applications; desktop and server management tools; software development tools; video games, and training and certification of computer system integrators and developers.

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