Microsoft price target raised to $516 from $511 at Bernstein

Bernstein analyst Mark Moerdler raised the firm’s price target on Microsoft (MSFT) to $516 from $511 and keeps an Outperform rating on the shares. Microsoft has become far less crowded over the last year due to investors’ concerns about CAPEX and the ability of Microsoft to convert CAPEX to revenue, the firm says. Those concerns are about to abate. Bernstein argues that Microsoft is in fact investing in global capacity, to meet the growing demand for inferencing. Most of the investment is in facilities, rather than compute and the firm expects CAPEX growth to slow substantially in the near-term. At the same time, it expects Azure revenue growth to accelerate to 35%-40% year-over-year in the first half of 2025.