Microsoft Shares Drop Following Analyst Downgrade
Microsoft (NASDAQ: MSFT) shares fell nearly 5% on Thursday due to a downgrade from Stifel analyst Brad Reback, who changed his rating from buy to hold and reduced the price target from $540 to $392 per share. Concerns were raised about high projections for Microsoft’s fiscal 2027 fundamentals, particularly around operational challenges in its Azure cloud business and increased expected capital expenditures rising to $200 billion, surpassing the average estimate of $160 billion.
This decline reflects a broader trend in the software sector, where many companies are facing investor skepticism, particularly regarding their ability to compete in the evolving artificial intelligence landscape. As Microsoft’s future growth appears uncertain amid these challenges, analysts suggest a cautious approach for potential investors.
