Current Stock Performance: Microsoft has shown strong long-term growth, with a 101.6% increase over three years, but has recently cooled off, experiencing a 1.8% decline in the past week and a 4.7% drop over the last month, despite being up 15.4% year-to-date.
Valuation Insights: Analysts suggest Microsoft is undervalued by approximately 19.4% based on a Discounted Cash Flow analysis, with an intrinsic value estimated at $599.76 per share, indicating the market may not fully reflect its long-term cash generation potential.
Price to Earnings Ratio: Microsoft currently trades at a price-to-earnings ratio of 34.2, which is above the industry average but below its peer group, suggesting that the stock may still be undervalued compared to its growth outlook.
Diverse Investor Narratives: Two contrasting narratives about Microsoft's future value exist: a bullish case estimating fair value at $500 per share, highlighting potential risks, and a bearish case at $423.14 per share, focusing on growth opportunities in AI and cloud services, illustrating differing investor perspectives on the stock's potential.
Wall Street analysts forecast MSFT stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for MSFT is 631.98 USD with a low forecast of 500.00 USD and a high forecast of 700.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
35 Analyst Rating
Wall Street analysts forecast MSFT stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for MSFT is 631.98 USD with a low forecast of 500.00 USD and a high forecast of 700.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
33 Buy
2 Hold
0 Sell
Strong Buy
Current: 487.480
Low
500.00
Averages
631.98
High
700.00
Current: 487.480
Low
500.00
Averages
631.98
High
700.00
Freedom Capital
Hold
to
Buy
upgrade
$13,340
2025-12-23
Reason
Freedom Capital
Price Target
$13,340
2025-12-23
upgrade
Hold
to
Buy
Reason
"Game On" is The Fly's weekly recap of the stories powering up or beating down video game stocks.VIDEO GAME SPENDING:Circana analyst Mat Piscatellathe release of Activision's"Call of Duty: Black Ops 7" marked the 18th consecutive year that a "CoD" franchise release has been the best-selling game of its release month, while PS5led hardware in both unit and dollar sales for the month of November. Total projected spending across video game hardware, content and accessories fell 4% when compared to a year ago, to $5.9B, in November in the U.S. Hardware, accessory and console content declines drove the change. The average price paid for a new unit of video game hardware in the US during November 2019 was $235. In November 2025 it was $439. 3.9M units of video game hardware sold in the US in November 2019. In November 2025 it was 1.6M, Piscatella noted. PlayStation 5 was November's best-selling hardware in both units and dollars, the first time this has occurred since the launch of the Nintendo Switch 2. Nintendo Switch 2 ranked 2nd for November across both units and dollars. Other top-selling games for the month were Electronic Arts'"Battlefield 6," Take-Two's"NBA 2K26," EA's "Madden NFL 26" and "EA Sports FC 26," Nintendo's "Pokemon Legends: Z-A," and Sony's "Ghost of Yotei."OVERTIME WORK:Staff at Sony'sNaughty Dog games studio, known for the "Last of Us" and "Uncharted" franchises, are working mandatory overtime to finish a demo of their upcoming title "Intergalactic: The Heretic Prophet," as the studio infamous for crunching on projects revives a now frowned-upon practice in the games industry, Bloomberg's Jason Schreier. For the past seven weeks, the developer has been pushing employees to work extra long hours to prepare for an upcoming review of the demo by Sony Interactive Entertainment, Sony's PlayStation business, Schreier says, citing people familiar with the situation. The game is set for release in mid-2027, the author says, citing people familiar with the schedule.BUY NINTENDO:Freedom Capital upgraded Nintendoto Buy from Hold with a 13,340 yen price target. The shares have come under significant pressure in recent weeks, declining 20% in the month of December alone driven by concerns around memory pricing, but commentary from Nintendo suggests that memory pricing concerns may be overdone and the company is still in "the early innings of the promising" Switch 2 cycle, the firm tells investors.HOGWARTS LEGACY:Warner Bros. Discoveryits 2023 video game "Hogwarts Legacy," a game based on the "Harry Potter" franchise, has sold 40M units total. The game is available on PC, PlayStation 4, PS5, Xbox One, Xbox Series X/S, Nintendo Switch, and Switch 2.Clickto check out recent Media Buzz Sentiment on Warner Bros. Discovery as measured by TipRanks.MORE VIDEO GAME NEWS:Disneydoesn'tRobloxa safe platform.A legalbetween Sonyand Tencentover the release of Tencent's game "Light of Motiram" has concludeD.
BTIG
BTIG
Buy
initiated
$1,000
2025-12-16
Reason
BTIG
BTIG
Price Target
$1,000
2025-12-16
initiated
Buy
Reason
BTIG assumed coverage of ServiceNow with a Buy rating and $1,000 price target. Two years after launching Now Assist, ServiceNow has built a robust platform for human and AI agent collaboration, featuring the AI Control Tower for management and governance, and partnering closely with Microsoft (MSFT) to power agentic AI orchestration across the entire enterprise, the analyst tells investors in a research note. In its bull case, BTIG sees ServiceNow continuing to operate above the Rule of 50, with high-teens top-line growth and mid-20% free cash flow growth, the firm added.
Phillip Securities
Accumulate -> NULL
downgrade
$550 -> $540
2025-12-14
Reason
Phillip Securities
Price Target
$550 -> $540
2025-12-14
downgrade
Accumulate -> NULL
Reason
Phillip Securities lowered the firm's price target on Microsoft to $540 from $550 and keeps an Accumulate rating on the shares. The firm says the company is aggressively into cloud and artificial intelligence infrastructure.
DA Davidson
Gil Luria
Buy
maintain
$650
2025-12-04
Reason
DA Davidson
Gil Luria
Price Target
$650
2025-12-04
maintain
Buy
Reason
DA Davidson analyst Gil Luria keeps a Buy rating and $650 price target on Microsoft, noting that the company will stay front of the line for OpenAI spend, which will keep it as the fastest growing hyperscaler in a wide range of scenarios. OpenAI still has one of the best frontier models, some of the deepest talent, and ChatGPT still has about 75% share of the AI chat market, and while OpenAI's over-committing, inflating expectations, and asking for federal government guarantees has caused a backlash across the AI trade, its valuable assets are still there, the analyst tells investors in a research note.
About MSFT
Microsoft Corporation is a technology company. The Company develops and supports software, services, devices, and solutions. The Company’s segments include Productivity and Business Processes, Intelligent Cloud, and More Personal Computing. The Productivity and Business Processes segment consists of products and services in its portfolio of productivity, communication, and information services. This segment primarily comprises: Office Commercial, Office Consumer, LinkedIn, and Dynamics business solutions. The Intelligent Cloud segment consists of server products and cloud services, including Azure and other cloud services, SQL Server, Windows Server, Visual Studio, System Center, and related Client Access Licenses (CALs), and Nuance and GitHub; and Enterprise Services, including enterprise support services, industry solutions and Nuance professional services. The More Personal Computing segment primarily comprises Windows, Devices, Gaming, and search and news advertising.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
