Tech giant Microsoft (MSFT) recently faced a new and unexpected analysis of its operations in Israel, reports note, as a team from Microsoft’s main branch recently examined those connections. The findings were somewhat disquieting, at least internally. Investors seemed a bit disquieted as well, as they sent Microsoft shares down around 1.5% in Monday afternoon’s trading.
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Last week, Microsoft Israel Country Manager Alon Haimovich departed the company. This was after Haimovich had served with Microsoft for four years, and came after Microsoft staged a review of Microsoft Israel’s operations, particularly as they connected to the Defense Ministry. Oddly, Haimovich departed with such rapidity that Microsoft did not even have a chance to consider a replacement for him, which one report regarded as “…clear evidence of the company leadership’s lack of confidence in the Israeli management.”
Reports noted that the issues that led to Haimovich’s sudden departure were connected to “…suspicions regarding the Israeli branch’s conduct with the defense establishment, especially the reliability of its reporting to global management.”
A New Union Shop
Meanwhile, Microsoft faces new troubles around growing union sentiment among its developers. Double Fine Studios, makers of the Psychonauts series, recently filed paperwork with the National Labor Relations Board to unionize, backed up by the Communications Workers of America. The union would cover 42 employees, with both full- and part-time included.
Double Fine’s move to unionize came as it sought to “…preserve and extend the studio’s commitments to creative excellence, diversity and inclusion, and worker quality of life.” Microsoft has found itself facing several new union shops, including the World of Warcraft Makers Guild, the Overwatch Gamemakers Guild-CWA, and a collective of Diablo developers.
Is Microsoft a Buy, Hold or Sell?
Turning to Wall Street, analysts have a Strong Buy consensus rating on MSFT stock based on 33 Buys and two Holds assigned in the past three months, as indicated by the graphic below. After a 7.6% loss in its share price over the past year, the average MSFT price target of $559.98 per share implies 36.94% upside potential.
