Microsoft (NASDAQ:MSFT) Shares Dip 0.3% - Should You Consider Selling?

Microsoft Corporation (NASDAQ:MSFT) saw its shares decrease by 0.3% during trading on Friday. The stock reached a low of $447.51 before last trading at $448.14. In total, about 3,649,151 shares were traded during the day, reflecting a significant decline of 82% compared to the average daily volume of 20,475,389 shares. Before this decline, the stock had closed at $449.56.

Analyst Ratings and Forecasts

Many analysts have recently provided updates regarding Microsoft's stock. KeyCorp raised its target price for Microsoft from $490.00 to $505.00, maintaining an "overweight" rating in a report dated October 18th. Morgan Stanley also increased its target price from $506.00 to $548.00, giving Microsoft an "overweight" rating as of October 31st. On the other hand, Sanford C. Bernstein reduced its price target slightly from $501.00 to $500.00 while keeping an "outperform" rating, citing analysts' report on October 25th. Furthermore, Wells Fargo & Company reaffirmed their "buy" rating on the same day. Mizuho set its price objective higher, increasing it from $480.00 to $510.00, and also rated the stock as "outperform." In total, two analysts have designated the stock as a hold, while twenty-seven have provided a buy rating. As per data from MarketBeat, Microsoft currently enjoys an average rating of "Moderate Buy" and an average price target of $505.43.

Microsoft's Financial Performance

Microsoft boasts a market capitalization of $3.33 trillion, with a price-to-earnings (P/E) ratio of 36.98 and a price/earnings to growth (P/E/G) ratio of 2.38. Additionally, the stock has a beta of 0.90. The 50-day simple moving average stands at $423.53, while the 200-day simple moving average is at $427.51. Financial ratios show a current ratio of 1.30, a quick ratio of 1.29, and a debt-to-equity ratio of only 0.15.

Recently, Microsoft reported its quarterly earnings on October 30th, revealing earnings of $3.30 per share for the quarter, which surpassed analysts' expectations of $3.10 by $0.20. The company experienced a return on equity of 34.56% and a net profit margin of 35.61%. The reported revenue for the quarter was $65.59 billion, exceeding the forecast of $64.57 billion, reflecting an impressive 16.0% increase in revenue compared to the same quarter last year. Analysts currently project that Microsoft will report 12.93 earnings per share for the ongoing year.

Dividend Announcements

In other news, Microsoft recently disclosed its plans for a quarterly dividend, set to be paid out on Thursday, March 13th. Shareholders recorded on February 20th will receive a dividend of $0.83, which translates to an annual dividend yield of 0.74% with a total payout of $3.32. Microsoft's payout ratio is currently at 27.39%.

The company also approved a stock buyback plan on September 16th, allowing for the repurchase of up to $60.00 billion worth of shares. This repurchase plan indicates that Microsoft's management believes the stock is undervalued, enabling them to buy back approximately 1.9% of outstanding shares through open market transactions.

Insider Trading Activity

Recently, some insider activity was reported at Microsoft. CMO Takeshi Numoto sold 1,000 shares on November 22nd at an average price of $414.72, totaling $414,720.00. Following this transaction, Numoto now owns 57,511 shares valued at approximately $23.85 million, marking a decrease of 1.71% in ownership. Additionally, EVP Christopher David Young sold 7,200 shares on November 12th at an average price of $423.66, totaling $3,050,352.00. This sale led Young to own 103,366 shares valued at about $43.79 million, a 6.51% decrease in ownership. In total, insiders have sold 41,200 shares in the past three months, equating to about $17.38 million. Currently, company insiders hold 0.03% of the company’s stock.

Institutional Investor Movements

Institutional investors have also made adjustments to their holdings in Microsoft recently. For instance, Brass Tax Wealth Management Inc. increased its stake by 2.6% during the third quarter, now owning 9,819 shares valued at $4.23 million. In contrast, Legacy Wealth Management LLC MS boosted its stake by 4.5%, amassing 44,895 shares worth $19.32 million after acquiring 1,933 additional shares. SPX Gestao de Recursos Ltda entered a new stake in Microsoft valued at approximately $6.15 million during the same period. Meanwhile, DGS Capital Management LLC increased its stake by 3.5%, currently owning 23,905 shares valued at $10.29 million. Garden State Investment Advisory Services LLC also expanded their stake by 4.6%, owning 13,488 shares worth $5.81 million. Currently, institutions hold approximately 71.13% of Microsoft stock.

About Microsoft

Microsoft Corporation is a global company known for developing and supporting various software, services, devices, and solutions. Its Productivity and Business Processes segment provides products like Office, Exchange, SharePoint, Microsoft Teams, Office 365 Security and Compliance, among others, including consumer services like Microsoft 365 subscriptions and licensed Office applications.

Microsoft, stocks, dividends