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Investing.com - Citi has raised its price target on Microsoft (NASDAQ:MSFT) stock to $613.00 from $605.00 while maintaining a Buy rating, citing expectations of strong quarterly results and positive revisions. The stock, currently trading at $510.06 and near its 52-week high of $514.64, has delivered a 21.48% return year-to-date. According to InvestingPro analysis, Microsoft’s current valuation metrics suggest the stock is trading at premium multiples.
The firm anticipates "another strong quarter of positive revisions and upside to Q4+Q1 Azure numbers" for Microsoft’s fiscal fourth quarter results. Citi’s reseller survey showed one of the strongest growth and quota attainment performances in over four years.
Partner checks highlighted strength in Microsoft’s CoPilot and Dynamics offerings, according to the research note. After previously raising Azure estimates in mid-June, Citi has further increased its projections.
Citi’s fiscal year 2026 estimate for Azure growth remains approximately three percentage points above the broader market consensus. The new price target is based on 30 times fiscal year 2028 earnings per share discounted back.
Microsoft remains Citi’s top pick in the sector due to its AI exposure, business model quality, and long-term pricing and margin power that the firm views as "nearly unmatched in enterprise software."
In other recent news, Microsoft has been the focus of several analyst updates and strategic developments. RBC Capital reiterated its Outperform rating on Microsoft, citing healthy cloud conditions and phased rollouts of its Copilot feature across enterprise clients. Additionally, BofA Securities raised its price target for Microsoft to $585, reflecting confidence in the company’s Azure cloud services, and noted the potential for a slight revenue increase in the upcoming fourth-quarter results. Meanwhile, OpenAI has entered into a strategic partnership with the UK government to accelerate AI adoption, focusing on economic and societal benefits through AI in public and private sectors.
In related news, Tevogen Bio announced the publication of its international patent application for AI-powered peptide prediction technology, developed in collaboration with Microsoft and Databricks. The World Intellectual Property Organization published this patent, highlighting Tevogen’s use of machine learning to predict immunologically active peptides. Furthermore, U.S. lawmakers have raised concerns with major tech companies, including Microsoft, about the security of submarine communications cables potentially serviced by Chinese and Russian entities. These developments underscore the dynamic landscape of technological advancements and regulatory scrutiny in the industry.
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