Microsoft (MSFT) stock has fallen 8.5% over the past week and 11.0% over the past month, but it is still up 4.4% over the last 12 months. Despite this recent pullback, Wall Street’s analysts are strongly bullish, with a 12‑month average price target of $603.27 versus the last closing price of $430.29. That consensus implies meaningful upside over the coming year and reflects confidence that the recent weakness is more of a pause than a change in the long‑term story.
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The latest detailed view comes from analyst Saiyi He of CMB International, who reiterated a Buy rating on Microsoft on January 30, 2026 and set a target price of $614.60. This target is above the Street’s average of $603.27 and suggests significant upside from current levels. He’s stance aligns with the broader “StrongBuy” analyst consensus, indicating that professional forecasters broadly see the current dip as an opportunity rather than a warning sign.
He’s report highlights Microsoft’s most recent quarterly results, which beat both his own and Bloomberg consensus estimates. Revenue outperformance was driven by stronger‑than‑expected contributions from the Productivity and Business Processes (PBP) and Intelligent Cloud (IC) segments. Operating income rose 20.9% year over year to $38.3 billion, coming in 3.8% to 4.8% ahead of forecasts. Despite trimming his DCF‑based target price slightly—by about 3% to $614.60—due to higher capital expenditure assumptions, He maintains that Microsoft’s long‑term structural growth story is intact.
Cloud remains a key pillar of that growth. In the latest quarter, the Intelligent Cloud segment delivered 28.8% year‑over‑year revenue growth to $32.9 billion, accounting for 40.5% of total company revenue. Azure and other cloud services grew 39% year over year, beating prior guidance of 37%, and management guided for 37–38% growth in the coming quarter. Capital expenditures reached $37.5 billion, up 66% year over year and slightly above consensus, with about two‑thirds spent on short‑lived assets such as GPUs and CPUs to meet strong demand. Management suggested that Azure’s growth could exceed 40% if all newly commissioned GPUs were directed to Azure, underscoring the strength of underlying demand even amid supply constraints.
Beyond cloud, Microsoft continues to expand revenue and profitability in its productivity suite. PBP revenue rose 15.9% year over year to $34.1 billion, or 42% of total revenue, supported by 14% and 27% constant‑currency growth in Microsoft 365 commercial and consumer cloud, respectively. Both customer seats and average revenue per user increased, helped by the rapid adoption of Microsoft 365 Copilot: daily active users have grown tenfold year over year, and paid Copilot seats reached 15 million in the quarter. Despite ongoing heavy investment in AI infrastructure, overall operating margin expanded to 47.1%, ahead of consensus, driven by improved leverage in PBP. For investors, this combination of strong cloud momentum, rising AI monetization, and resilient margins underpins the bullish 12‑month outlook.
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