acknowledged that the “timing of growth levers” for Microsoft was one area where investors didn’t get “much clarity” in the latest report, though he also stayed bullish over the long run, maintaining an outperform rating and $390 target. “The long term monetization opportunity around Gen AI is very much intact and Microsoft is uniquely positioned in the commercial market to benefit from AI adoption,” he added.ĭerrick Wood of Cowen & Co. He has an outperform rating and $400 target price on Microsoft shares. Microsoft’s setup “remains compelling into as Azure growth is showing signs of bottoming,” while comparisons for the More Personal Computing segment that includes Windows ” get materially easier” after the fiscal first quarter, “and the Copilot monetization opportunity will only grow over the course of the year.” He suggested that investors should buy the dip on Microsoft shares, off 3.5% in Wednesday’s premarket trading. Opinion: Despite hype, tech earnings still won’t show many results from AI yet it’s going to take time) though investors may have wanted more specifics on that opportunity,” he wrote. “We believe Microsoft did the right thing in terms of level setting expectations around near-term monetization of Copilot (i.e. Though Microsoft underwhelmed a bit with its fiscal first-quarter forecast, Evercore ISI’s Kirk Materne said the company was correct to take a conservative view of AI revenue timing for the year ahead. “That could create the potential for some large beats and raises as we move through fiscal 2024,” he wrote, while keeping his market-perform rating on the stock but boosting his target price to $355 from $306. Meanwhile, Microsoft’s management seems to be contemplating only “modest” adoption in its outlook. Microsoft is in the midst of making various products, such as a Copilot productivity offering for the security market, available for general use, and the “potential revenue from these products could be very large,” SVB MoffettNathanson analyst Sterling Auty wrote after the company’s Tuesday afternoon earnings report. Opinion: Microsoft’s AI payday will take time, and investors need to be patient
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