UPDATE: Analysts have just raised their stock price targets for Microsoft (MSFT) as excitement builds ahead of the company’s Q4 earnings report scheduled for July 30, 2024. Wedbush analyst Dan Ives has placed Microsoft among his top five tech picks for the second half of the year, highlighting the company’s pivotal role in the ongoing AI revolution.
In a recent research note, Ives emphasized that Microsoft, alongside AI-chip leader Nvidia (NVDA), is at the forefront of the biggest tech trend seen in 25 years. He noted, “The poster children for the AI Revolution are led by Nvidia and Microsoft, as both are foundational pieces of building on this trend.”
Ives predicts a strong performance for Microsoft in the June quarter, driven primarily by its Azure and Intelligent Cloud services. “With over 15% of cloud services now incorporating AI, this technology is transforming cloud projects and enhancing profitability,” he stated.
Microsoft’s CEO, Satya Nadella, previously highlighted the accelerating demand for Azure, noting that major companies such as Abercrombie & Fitch and Coca-Cola are expanding their Azure footprints. The Intelligent Cloud segment has already seen a 21% revenue surge to $26.8 billion in fiscal Q3.
Ives holds an ambitious price target of $600 for Microsoft shares, citing the growing monetization opportunities tied to AI and cloud services. He remarked, “It has become crystal clear that deploying AI in the cloud is a transformational opportunity across the industry, with Redmond in the driver’s seat.”
In addition to Ives, analysts from Cantor Fitzgerald and Mizuho have also increased their price targets for Microsoft, now set at $581 and $540, respectively. While Mizuho noted healthy demand for cybersecurity and AI adoption, they cautioned about potential deal delays that could impact the upcoming earnings.
Cantor Fitzgerald reported continued positive momentum from their channel checks, indicating optimism heading into the second half of 2024.
As anticipation builds for the earnings report, Microsoft’s stock has surged nearly 20% this year, showcasing strong investor confidence in the company’s future growth.
The upcoming earnings report will be crucial for investors to gauge Microsoft’s performance against its ambitious projections. Analysts are closely monitoring the impact of cloud and AI-driven spending as enterprises ramp up their investments in these areas.
Stay tuned for the latest updates as Microsoft prepares to unveil its quarterly results. This could be a defining moment for the company’s growth trajectory in the tech landscape.
