<Research>Jefferies: Microsoft (MSFT.US) Upgraded to Buy Due to More Favorable Valuation Compared to Competitors
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1d ago
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Source: aastocks
Share Price Decline: Microsoft's share price has dropped 18% since the first fiscal quarter, despite significant investment commitments in OpenAI and Anthropic totaling US$280 billion.
Valuation Compression: The company's valuation multiple has decreased by 23% as investors favor semiconductor stocks, although Microsoft is expected to increase output due to a strong order backlog.
Attractive EPS Valuation: Microsoft's FY2027 EPS valuation at 23x is considered attractive compared to competitors like Amazon and Alphabet, which have higher valuations.
Broker Rating: Jefferies has rated Microsoft as a Buy with a target price of US$675, citing clearer operational visibility and AI monetization potential compared to its competitors.
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.
