Microsoft price target lowered to $400 from $430 at Melius Research

Melius Research lowered the firm’s price target on Microsoft (MSFT) to $400 from $430 and keeps a Hold rating on the shares. Bulls argue Microsoft has time to refine its AI strategy, but ongoing issues with Copilot and internal models limit Azure’s upside and may persist beyond a single quarter, the analyst tells investors in a research note. Combined with potential pressure on Productivity & Business Processes from layoffs, a potential Windows PC market decline, high relative valuation, and rising CapEx, Microsoft could become a source of cash for investors reallocating to AI and space plays like Anthropic, OpenAI, and SpaceX through 2027, the firm says.