Microsoft (NASDAQ:MSFT) Shares Up 1.2% – Should You Buy?

Microsoft Corporation (NASDAQ:MSFT) shares shot up 1.2% on Tuesday . The company traded as high as $478.74 and last traded at $478.51. 22,958,700 shares traded hands during mid-day trading, a decline of 7% from the average session volume of 24,585,184 shares. The stock had previously closed at $472.85.

Trending Headlines about Microsoft

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Broad market tailwind — Tech-led gains pushed major U.S. indexes to records, with Microsoft among the leaders benefiting from the risk-on move. How major US stock indexes fared Tuesday, 1/6/2026
• Positive Sentiment: Grid modernization win — Microsoft agreed to work with the Midcontinent Independent System Operator to modernize the U.S. Midwest power grid, highlighting Azure and AI demand tied to large-scale electrification and data-center power needs. This supports long-term infrastructure demand for Microsoft cloud services. Microsoft works with major US electric grid operator to modernize the Midwest power system
• Positive Sentiment: Acquisition accelerates data engineering push — Microsoft acquired Osmos, a data-engineering startup, to bolster its autonomous data engineering capabilities that feed AI and analytics products, strengthening its competitive positioning in enterprise AI. Microsoft acquires data analytics Seattle startup Osmos
• Positive Sentiment: Marketplace partner expansion — Profitmind, an agentic AI decision-intelligence platform for retail, is now available in the Microsoft Marketplace, a smaller but incremental signal of ecosystem monetization for Azure and Dynamics customers. Profitmind Now Available in the Microsoft Marketplace
• Positive Sentiment: Analyst and market conviction — High-profile bulls (e.g., Wedbush/Daniel Ives) and multiple recent buy/price-target upgrades underline expectations for an “inflection” year driven by Azure AI and enterprise adoption. That supportive analyst backdrop is lifting sentiment. Daniel Ives Pounds the Table on Nvidia and Microsoft Stocks
• Neutral Sentiment: Partner ecosystem activity — Microsoft-backed partner Photonic raised $131M for quantum initiatives, signalling continued ecosystem investment though not an immediate revenue driver for MSFT. Microsoft Partner Photonic Raises $131 Million for Quantum Push
• Negative Sentiment: Talent and competitive notes — A senior Microsoft lawyer moved to Meta (C.J. Mahoney), and ongoing public debate about AI competition with Google/other rivals keeps uncertainty in the headlines; plus recent insider sales and chatter about valuation could cap near-term upside. Meta hires Microsoft exec as chief legal officer

Wall Street Analysts Forecast Growth

A number of analysts have weighed in on MSFT shares. Redburn Partners set a $560.00 target price on shares of Microsoft in a research report on Wednesday, October 22nd. BNP Paribas Exane increased their price target on Microsoft from $630.00 to $632.00 and gave the company an “outperform” rating in a research note on Monday, November 3rd. Melius Research raised their price objective on Microsoft from $595.00 to $625.00 in a report on Thursday, September 25th. Rothschild Redb lowered Microsoft from a “strong-buy” rating to a “hold” rating in a research report on Tuesday, November 18th. Finally, KeyCorp reiterated an “overweight” rating on shares of Microsoft in a research report on Thursday, October 30th. Two equities research analysts have rated the stock with a Strong Buy rating, thirty-seven have assigned a Buy rating and four have issued a Hold rating to the stock. Based on data from MarketBeat.com, the stock has an average rating of “Moderate Buy” and a consensus price target of $631.03.

Microsoft Stock Performance

The firm has a market capitalization of $3.56 trillion, a P/E ratio of 34.03, a price-to-earnings-growth ratio of 1.77 and a beta of 1.07. The company has a 50-day moving average of $492.29 and a 200-day moving average of $503.98. The company has a current ratio of 1.40, a quick ratio of 1.39 and a debt-to-equity ratio of 0.10.

Microsoft (NASDAQ:MSFT) last issued its quarterly earnings results on Wednesday, October 29th. The software giant reported $4.13 earnings per share for the quarter, beating the consensus estimate of $3.65 by $0.48. Microsoft had a return on equity of 32.45% and a net margin of 35.71%.The company had revenue of $77.67 billion during the quarter, compared to analysts’ expectations of $75.49 billion. During the same quarter in the prior year, the firm posted $3.30 earnings per share. The business’s quarterly revenue was up 18.4% on a year-over-year basis. On average, equities analysts anticipate that Microsoft Corporation will post 13.08 earnings per share for the current fiscal year.

Microsoft Announces Dividend

The company also recently declared a quarterly dividend, which will be paid on Thursday, March 12th. Shareholders of record on Thursday, February 19th will be issued a dividend of $0.91 per share. The ex-dividend date is Thursday, February 19th. This represents a $3.64 annualized dividend and a yield of 0.8%. Microsoft’s dividend payout ratio (DPR) is presently 25.89%.

Insider Transactions at Microsoft

In related news, CEO Judson Althoff sold 12,750 shares of Microsoft stock in a transaction on Tuesday, December 2nd. The shares were sold at an average price of $491.52, for a total transaction of $6,266,880.00. Following the completion of the transaction, the chief executive officer owned 129,349 shares of the company’s stock, valued at $63,577,620.48. This trade represents a 8.97% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available at the SEC website. Also, insider Bradford L. Smith sold 38,500 shares of the business’s stock in a transaction on Monday, November 3rd. The shares were sold at an average price of $518.64, for a total transaction of $19,967,640.00. Following the completion of the transaction, the insider owned 461,597 shares in the company, valued at approximately $239,402,668.08. The trade was a 7.70% decrease in their position. The disclosure for this sale is available in the SEC filing. In the last 90 days, insiders have sold 54,100 shares of company stock worth $27,598,872. Company insiders own 0.03% of the company’s stock.

Institutional Inflows and Outflows

Several hedge funds have recently made changes to their positions in the business. Longfellow Investment Management Co. LLC increased its stake in shares of Microsoft by 51.3% in the 2nd quarter. Longfellow Investment Management Co. LLC now owns 59 shares of the software giant’s stock valued at $29,000 after acquiring an additional 20 shares in the last quarter. Bulwark Capital Corp acquired a new stake in Microsoft in the second quarter worth $32,000. Westend Capital Management LLC increased its stake in Microsoft by 386.7% in the second quarter. Westend Capital Management LLC now owns 73 shares of the software giant’s stock valued at $36,000 after purchasing an additional 58 shares in the last quarter. Bayforest Capital Ltd acquired a new position in shares of Microsoft during the third quarter valued at about $38,000. Finally, LSV Asset Management acquired a new position in shares of Microsoft during the fourth quarter valued at about $44,000. 71.13% of the stock is owned by institutional investors.

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).