Microsoft Stock ( NASDAQ:MSFT )
On Friday, as of 11:25 a.m. ET, Microsoft ( NASDAQ:MSFT ) stock was up 2.4%, even though not one, not two, but three analysts have lowered their price estimates on the tech giant in advance of its earnings report expected out Tuesday.
Today, The Fly, which tracks analyst ratings, reports that three independent firms—Cowen & Co., Evercore ISI, and Citigroup—have cut their price estimates on Microsoft shares. Although, all three investment bankers still advise purchasing Microsoft stock before the earnings announcement (which is probably why the stock is rising today).
The odd thing is that each of these bankers predicted an exact $280 for Microsoft’s new price objective.
What’s the Reason?
To what extent does Microsoft’s fixation with $280 stem from some kind of magical significance for that sum? So, why do these three experts think Microsoft stock will rise by precisely 18% in the next year?
Reasons vary for each party. For instance, Cowen believes that Microsoft’s Azure cloud computing segment expanded more slowly in fiscal Q2 than previously anticipated but nevertheless climbed by 33% or perhaps 34%, as reported by StreetInsider. Cowen also believes that other analysts might be overstating the threats to Microsoft Office sales.
The news that Microsoft would be laying off 10,000 staff is unrelated. Cowen estimates that Microsoft’s profits would be reduced by $0.10 per share this year due to severance expenses incurred due to the reorganization.
In contrast, Evercore thinks Microsoft can “dynamically...
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