It was just 10 days ago when we found that tech giant Microsoft (MSFT) was putting a temporary pause on purchases of carbon removal operations. This likely did not mean much to most people, but to the carbon removal industry, it was a disaster. The extent of that disaster recently emerged, and Microsoft investors were oddly pleased about it. Microsoft shares gained over 2% in Friday’s trading.
Claim 55% Off TipRanks
- Unlock hedge fund-level data and powerful investing tools for smarter, sharper decisions
- Discover top-performing stock ideas and upgrade to a portfolio of market leaders with Smart Investor Picks
Microsoft, reports noted, served as the market’s “majority buyer.” So when that buyer departs the market—even temporarily as Microsoft planned to—the market itself is left with a gaping hole in it. Things were already troubled in the carbon removal market before Microsoft’s departure, but this simply makes a bad situation worse. One report called for “…pivots, bankruptcies and company shutdowns in this space to accelerate through the year.” The long and the short of it is that, without Microsoft, “…demand would not be strong enough” for the industry to continue.
One major part of the whole operation was that Microsoft planned to be carbon negative by 2030, and pull “historical emissions” from the air by 2050. That was unique, but Microsoft was largely alone in this field. Microsoft may well have bought all the removal credits it needed already, as we hypothesized back when the news first came out.
“We Are Xbox”
A recent note from Asha Sharma was uncovered and posted over at Xbox’s own website. That letter, titled simply “We Are Xbox,” offered some noteworthy vision for Xbox’s future going forward. The letter began by acknowledging Xbox’s longevity, calling attention once more to the 25th anniversary of Xbox.
But the letter went on from there, pointing out the problems that players have. Console feature drops are less frequent than they were. Pricing is increasingly an issue as game prices go up yet deliver as much or less than they did previously. That led the letter to declare, “Xbox will be where the world plays.” The letter also announced a plan to focus on “daily active users,” including strengthening third-party partnerships, and fixing “fundamentals” for players and partners alike.
Is Microsoft a Buy, Hold or Sell?
Turning to Wall Street, analysts have a Strong Buy consensus rating on MSFT stock based on 34 Buys and two Holds assigned in the past three months, as indicated by the graphic below. After a 6.1% rally in its share price over the past year, the average MSFT price target of $577.05 per share implies 37.73% upside potential.
