Microsoft (NASDAQ:MSFT) Shares Up 1.4% After Better-Than-Expected Earnings

Microsoft Co. (NASDAQ:MSFT) shot up 1.4% during mid-day trading on Wednesday following a stronger than expected earnings report. The stock traded as high as $438.50 and last traded at $437.93. 6,166,840 shares changed hands during mid-day trading, a decline of 69% from the average session volume of 20,137,863 shares. The stock had previously closed at $431.95.

The software giant reported $3.30 EPS for the quarter, beating analysts’ consensus estimates of $3.08 by $0.22. Microsoft had a net margin of 35.61% and a return on equity of 35.73%. The firm had revenue of $65.59 billion for the quarter, compared to analysts’ expectations of $64.57 billion. During the same period in the prior year, the company earned $2.99 EPS. The firm’s revenue was up 16.0% on a year-over-year basis.

Microsoft Increases Dividend

The firm also recently disclosed a quarterly dividend, which will be paid on Thursday, December 12th. Stockholders of record on Thursday, November 21st will be issued a dividend of $0.83 per share. This is a boost from Microsoft’s previous quarterly dividend of $0.75. The ex-dividend date is Thursday, November 21st. This represents a $3.32 annualized dividend and a dividend yield of 0.81%. Microsoft’s dividend payout ratio (DPR) is 24.75%.

Microsoft declared that its Board of Directors has authorized a share buyback plan on Monday, September 16th that authorizes the company to repurchase $60.00 billion in outstanding shares. This repurchase authorization authorizes the software giant to buy up to 1.9% of its stock through open market purchases. Stock repurchase plans are generally an indication that the company’s leadership believes its shares are undervalued.

Wall Street Analyst Weigh In

MSFT has been the subject of a number of research reports. Bank of America boosted their price target on Microsoft from $480.00 to $510.00 and gave the company a “buy” rating in a research report on Wednesday, July 17th. Wedbush restated an “underperform” rating on shares of Microsoft in a research note on Friday, October 18th. Citigroup reduced their target price on Microsoft from $500.00 to $497.00 and set a “buy” rating on the stock in a report on Wednesday, October 23rd. Oppenheimer downgraded shares of Microsoft from an “outperform” rating to a “market perform” rating in a research report on Tuesday, October 8th. Finally, DA Davidson cut Microsoft from a “buy” rating to a “neutral” rating and set a $475.00 target price on the stock. in a research note on Monday, September 23rd. One research analyst has rated the stock with a sell rating, three have assigned a hold rating and twenty-six have given a buy rating to the stock. Based on data from MarketBeat, Microsoft presently has a consensus rating of “Moderate Buy” and an average price target of $503.03.

Insiders Place Their Bets

In related news, insider Bradford L. Smith sold 40,000 shares of the stock in a transaction on Monday, September 9th. The stock was sold at an average price of $402.59, for a total transaction of $16,103,600.00. Following the completion of the sale, the insider now directly owns 544,847 shares in the company, valued at approximately $219,349,953.73. This trade represents a 0.00 % decrease in their ownership of the stock. The sale was disclosed in a legal filing with the Securities & Exchange Commission, which is accessible through the SEC website. In other Microsoft news, CMO Takeshi Numoto sold 2,500 shares of Microsoft stock in a transaction that occurred on Tuesday, September 10th. The shares were sold at an average price of $411.04, for a total value of $1,027,600.00. Following the completion of the sale, the chief marketing officer now directly owns 50,000 shares in the company, valued at $20,552,000. The trade was a 0.00 % decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through the SEC website. Also, insider Bradford L. Smith sold 40,000 shares of the firm’s stock in a transaction on Monday, September 9th. The shares were sold at an average price of $402.59, for a total transaction of $16,103,600.00. Following the transaction, the insider now owns 544,847 shares in the company, valued at $219,349,953.73. This represents a 0.00 % decrease in their position. The disclosure for this sale can be found here. Insiders sold a total of 190,629 shares of company stock worth $77,916,485 in the last quarter. 0.03% of the stock is currently owned by corporate insiders.

Hedge Funds Weigh In On Microsoft

Several institutional investors have recently bought and sold shares of MSFT. Christopher J. Hasenberg Inc lifted its holdings in Microsoft by 169.2% in the 2nd quarter. Christopher J. Hasenberg Inc now owns 70 shares of the software giant’s stock worth $31,000 after purchasing an additional 44 shares during the last quarter. Quarry LP acquired a new position in Microsoft in the second quarter valued at about $45,000. Richardson Capital Management LLC increased its holdings in shares of Microsoft by 1,290.0% during the first quarter. Richardson Capital Management LLC now owns 139 shares of the software giant’s stock worth $59,000 after buying an additional 129 shares in the last quarter. Innealta Capital LLC bought a new position in shares of Microsoft in the second quarter valued at approximately $75,000. Finally, Bellevue Group AG boosted its holdings in shares of Microsoft by 47.5% in the 1st quarter. Bellevue Group AG now owns 180 shares of the software giant’s stock worth $76,000 after acquiring an additional 58 shares in the last quarter. 71.13% of the stock is currently owned by institutional investors.

Microsoft Price Performance

The stock has a market capitalization of $3.04 trillion, a price-to-earnings ratio of 33.53, a PEG ratio of 2.27 and a beta of 0.90. The company has a current ratio of 1.27, a quick ratio of 1.27 and a debt-to-equity ratio of 0.16. The stock has a fifty day moving average of $420.82 and a two-hundred day moving average of $424.58.

Microsoft Company Profile

Microsoft Corporation develops and supports software, services, devices and solutions worldwide. The Productivity and Business Processes segment offers office, exchange, SharePoint, Microsoft Teams, office 365 Security and Compliance, Microsoft viva, and Microsoft 365 copilot; and office consumer services, such as Microsoft 365 consumer subscriptions, Office licensed on-premises, and other office services.