Microsoft (NASDAQ:MSFT) Stock Price Down 3.2% – Here’s Why

Microsoft Corporation (NASDAQ:MSFT) fell 3.2% during mid-day trading on Monday . The stock traded as low as $367.07 and last traded at $367.34. Approximately 43,997,329 shares traded hands during trading, an increase of 22% from the average daily volume of 36,136,215 shares. The stock had previously closed at $379.40.

Key Stories Impacting Microsoft

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: Microsoft’s new 20-year power agreement with Chevron for a Texas AI data center is being viewed as a strategic move to secure the electricity needed for future Azure and AI growth, reinforcing the company’s long-term infrastructure buildout. Article Title
• Positive Sentiment: Several commentary pieces argue Microsoft is being unfairly punished for AI capex and that the company is actually building a wider moat, with bullish notes pointing to a substantial AI revenue run rate and potential upside if spending converts into growth. Article Title
• Positive Sentiment: Microsoft’s education-focused AI report and related product announcements suggest continued enterprise and institutional adoption of its AI tools, supporting the long-term monetization story. Article Title
• Neutral Sentiment: Analyst commentary from Stifel reiterated a Hold rating, saying the Chevron deal highlights power demand for AI data centers but does not materially change the near-term investment case. Article Title
• Negative Sentiment: Microsoft is facing multiple securities class-action alerts tied to alleged investor harm, adding legal uncertainty and sentiment pressure on the shares. Article Title
• Negative Sentiment: A new critique in Nature and Reuters coverage questioned Microsoft’s quantum-computing breakthrough, increasing doubts about a key technology narrative and weighing on investor confidence. Article Title
• Negative Sentiment: More broadly, investors remain worried that Microsoft’s heavy AI/data-center spending is pressuring free cash flow, which has fueled recent volatility in the stock. Article Title

Analysts Set New Price Targets

Several research analysts have recently weighed in on the stock. Citizens Jmp started coverage on shares of Microsoft in a research note on Monday, June 1st. They set an “outperform” rating and a $550.00 price target on the stock. Robert W. Baird reduced their price objective on Microsoft from $540.00 to $500.00 and set an “outperform” rating for the company in a research note on Wednesday, April 15th. Cantor Fitzgerald reaffirmed an “overweight” rating and issued a $502.00 target price on shares of Microsoft in a report on Thursday, June 4th. Oppenheimer reiterated an “outperform” rating and set a $515.00 target price (down from $630.00) on shares of Microsoft in a research report on Monday, April 27th. Finally, China Renaissance cut their price target on Microsoft from $630.00 to $550.00 and set a “buy” rating for the company in a report on Monday, May 4th. Forty-one investment analysts have rated the stock with a Buy rating and six have issued a Hold rating to the stock. Based on data from MarketBeat.com, the company has an average rating of “Moderate Buy” and an average target price of $561.20.

Microsoft Trading Down 2.4%

The stock’s 50 day moving average price is $412.32 and its 200-day moving average price is $423.55. The company has a quick ratio of 1.27, a current ratio of 1.28 and a debt-to-equity ratio of 0.08. The stock has a market capitalization of $2.71 trillion, a PE ratio of 21.73, a PEG ratio of 1.32 and a beta of 1.11.

Microsoft (NASDAQ:MSFT) last announced its quarterly earnings data on Wednesday, April 29th. The software giant reported $4.27 EPS for the quarter, beating the consensus estimate of $4.06 by $0.21. Microsoft had a net margin of 39.34% and a return on equity of 31.94%. The firm had revenue of $82.89 billion for the quarter, compared to the consensus estimate of $81.44 billion. During the same period last year, the firm earned $3.46 EPS. The company’s revenue was up 18.3% on a year-over-year basis. On average, sell-side analysts expect that Microsoft Corporation will post 16.76 earnings per share for the current fiscal year.

Microsoft Dividend Announcement

The firm also recently announced a quarterly dividend, which will be paid on Thursday, September 10th. Investors of record on Thursday, August 20th will be given a dividend of $0.91 per share. The ex-dividend date is Thursday, August 20th. This represents a $3.64 annualized dividend and a dividend yield of 1.0%. Microsoft’s dividend payout ratio (DPR) is currently 21.67%.

Insider Activity at Microsoft

In other Microsoft news, EVP Takeshi Numoto sold 4,500 shares of the stock in a transaction that occurred on Wednesday, June 10th. The shares were sold at an average price of $402.84, for a total transaction of $1,812,780.00. Following the completion of the sale, the executive vice president directly owned 47,468 shares of the company’s stock, valued at $19,122,009.12. This trade represents a 8.66% decrease in their position. The sale was disclosed in a filing with the SEC, which is available through the SEC website. Also, EVP Amy Coleman sold 1,262 shares of Microsoft stock in a transaction that occurred on Thursday, May 14th. The shares were sold at an average price of $411.34, for a total transaction of $519,111.08. Following the sale, the executive vice president owned 46,003 shares in the company, valued at approximately $18,922,874.02. The trade was a 2.67% decrease in their position. The disclosure for this sale is available in the SEC filing. In the last 90 days, insiders have sold 23,762 shares of company stock valued at $10,508,361. 0.03% of the stock is owned by company insiders.

Hedge Funds Weigh In On Microsoft

Several institutional investors have recently bought and sold shares of the stock. Norges Bank bought a new stake in Microsoft in the 4th quarter worth approximately $50,664,631,000. Auto Owners Insurance Co boosted its position in shares of Microsoft by 56,160.8% during the 4th quarter. Auto Owners Insurance Co now owns 60,116,384 shares of the software giant’s stock valued at $29,073,486,000 after acquiring an additional 60,009,531 shares during the last quarter. Nuveen LLC purchased a new position in shares of Microsoft in the first quarter valued at $18,733,827,000. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC grew its holdings in shares of Microsoft by 500.0% in the third quarter. UBS AM A Distinct Business Unit of UBS Asset Management Americas LLC now owns 59,543,261 shares of the software giant’s stock valued at $30,840,432,000 after purchasing an additional 49,618,571 shares in the last quarter. Finally, Laurel Wealth Advisors LLC increased its position in Microsoft by 49,640.3% in the second quarter. Laurel Wealth Advisors LLC now owns 29,967,038 shares of the software giant’s stock worth $14,905,904,000 after purchasing an additional 29,906,791 shares during the last quarter. 71.13% of the stock is owned by hedge funds and other institutional investors.

Microsoft Company Profile

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).