TD Cowen analyst Derrick Wood maintained a Buy rating on Microsoft (MSFT – Research Report) yesterday and set a price target of $475.00.
Derrick Wood’s rating is based on Microsoft’s strong performance in recent weeks, as it has outpaced its peers, attracting investors seeking stability. The company shows potential for growth in its Azure segment, despite some weaker third-party data in the first quarter. Microsoft is expected to maintain flat growth trends into the fourth quarter, with Windows likely contributing positively to revenue and margins in the third quarter.
Furthermore, the adoption of Microsoft’s Copilot and new AI capabilities in its Office segment is progressing well, which should drive stronger demand and broader adoption in the coming quarters. Despite some mixed end-market checks, the introduction of new pricing options is expected to bolster growth. Additionally, Microsoft’s shares have declined since their peak in February, but they continue to outperform the group, trading at a favorable valuation. The foreign exchange trends are also anticipated to provide a positive impact on estimates.
According to TipRanks, Wood is a 5-star analyst with an average return of 12.2% and a 55.53% success rate. Wood covers the Technology sector, focusing on stocks such as Microsoft, ServiceNow, and Atlassian.
In another report released yesterday, Bank of America Securities also reiterated a Buy rating on the stock with a $480.00 price target.