Microsoft price target lowered to $515 from $630 at Oppenheimer

Oppenheimer lowered the firm’s price target on Microsoft (MSFT) to $515 from $630 and keeps an Outperform rating on the shares ahead of the Q3 earnings update. In the firm’s view, investor concerns over AI disruption to the M365 franchise, future Capex growth, increasing competitive pressures, and perception that management is playing catch-up in the AI market are unlikely to be resolved post Q3 update. However, Oppenheimer sees a favorable earnings set-up from Azure business showing upside, and a more constructive post-earnings estimate revision trend supporting the stock.