Microsoft Gets a Price Target Boost from Two Wall Street Analysts

Tech giant Microsoft received a couple of positive reports from Wall Street analysts recently on pandemic induced work from home orders and a bright outlook for the year ahead.

Analyst Walter Pritchard of Citi has upgraded the stock from “neutral” to “buy” and increased his price target from $229 to $279.

Morgan Stanley analyst Keith Weiss reiterated an “overweight” rating and raised his price target from $249 to $260.

Pritchard is optimistic about the company’s cloud computing business which includes Azure infrastructure services and Office 365 productivity software. According to his note from this past weekend, Microsoft will continue to benefit from the work from home trend that has been brought on by the coronavirus pandemic.

“Covid-19 had, initially, an uncertain impact on IT (information technology) spending across the board, with the March-to-June time frame seeing mixed, even negative impacts,” Pritchard said.

“What has become more clear is, in the months after the initial impact, the forces that have emerged with Covid-19 are likely to change the landscape for many years to come,” he added.

The analyst sees large businesses moving more of their computing workloads to the cloud and he favors Microsoft’s positioning in cloud computing vs. Amazon.com’s (AMZN) Amazon Web Services and Alphabet’s (GOOGL) Google Cloud.

Weiss of Morgan Stanley has called Microsoft “one of our top picks heading into 2021.”
“We see potential for outperformance in fiscal 2021,” he said in note to clients last Friday. “The durability of growth and margin expansion are underappreciated” for Microsoft stock Weiss.

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.