Microsoft (MSFT – Research Report), the Technology sector company, was revisited by a Wall Street analyst today. Analyst Derrick Wood from TD Cowen reiterated a Buy rating on the stock and has a $490.00 price target.
Derrick Wood has given his Buy rating due to a combination of factors that highlight Microsoft’s strong financial performance and growth potential. The company reported a robust third-quarter revenue growth of approximately 15% in constant currency, surpassing market expectations. Azure, Microsoft’s cloud platform, showed impressive growth of 35% in constant currency, driven by a resurgence in non-AI growth and increased capacity for AI workloads.
Additionally, Microsoft’s management provided a solid outlook for the fourth quarter, with expectations of continued revenue growth and stable demand across various business segments, including commercial, LinkedIn, Gaming, and Search. The company’s cloud growth and operational margins also exceeded expectations, further supporting the positive outlook. The demand for AI solutions remains strong, with Microsoft anticipating capacity constraints due to the high demand, which bodes well for future growth. These factors collectively contribute to Derrick Wood’s decision to maintain a Buy rating for Microsoft’s stock.
In another report released today, Stifel Nicolaus also maintained a Buy rating on the stock with a $500.00 price target.