Name of opportunity: 👀
Microsoft Corporation
Giving investors what they’ve been calling for: ☎️
Microsoft has recently been under some pressure from investors who want to know if the tech company’s high spend on AI will be worth it. Microsoft’s capital expenditure in the quarter ending June 30 was $19bn, which is 80% higher than what was spent in the same period a year prior - and chief financial officer Amy Hall said this was “nearly all” on cloud-computing and AI.
In what could be interpreted as an effort to reassure them, Microsoft has announced some moves that investors may have been excited to hear about. From the next dividend payout date of 12 December, the company will raise its dividends payouts by 10% to reach 83 cents per share. Microsoft has also announced a $60 billion stock buyback program. Stock buybacks usually drive up the value of the remaining shares that the company does not buy, because it reduces the number of shares available.
How hot is this investment opportunity? 🔥🔥🔥
Analysts predict the price of Microsoft Corporation will increase from $431.34 to $488.04 in the next 12 months. If you invested $1000, you might profit $131.46.
While Microsoft is currently recommended as a ‘Buy’, as you can see in the screenshot below, it’s leaning very close to ‘Strong Buy’.
Some reasons why analysts are currently recommending Microsoft include the fact that it has a strong dividend track record and has been a leader in the software industry for many years, leading some analysts to call it a ‘safer’ stock.
Microsoft’s cloud computing service Microsoft Azure grew its revenue by 29% last quarter - the company has partnered with OpenAI to offer enhanced tools to cloud users, which has proved popular. 65% of Fortune 500 companies have used the Azure OpenAI tools so far. It seems like focusing the company’s energy in this direction might be paying off for now.
Tech giant: 🖥️
Microsoft Corporation is a multinational technology company that develops and supports software, services, devices, and solutions, from office software to products in the gaming sector. It’s one of the ‘Magnificent 7’ tech stocks that are considered to be particularly significant. Founded in 1975 by Bill Gates, it has grown to produce a global annual revenue of $109 billion as of 2023, and has about 228,000 full-time employees worldwide.
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