Microsoft Stock has ‘Long-Term Advantages.’ Says, Analyst

Microsoft stock

The Microsoft stock price has dropped by thirty percent in what has been a terrible year so far for technology equities. Just now, an analyst working for Raymond James has emerged from the shadows to argue that now is the moment to purchase the dip.

Microsoft Stock Outperform Rating

Andrew Marok, an analyst at Raymond James, has resumed coverage on Microsoft Corporation (NASDAQ:MSFT) shares with an Outperform rating and a $300 price target. According to what Marok wrote, there is “a collection of sustainable advantages in the tale.” On June 11, 2021, Raymond James made the decision to suspend coverage.

In trading on Friday afternoon, Microsoft stock price remained relatively unchanged at $237.38.

Marok believes that the company’s investments in cloud technology will provide wider benefits to the company’s other businesses, such as customer relationship management, gaming, and advertising.

According to Marok, “Microsoft is able to invest at a scale that most other rivals in these areas cannot match,” and “we do not consider investment in Azure as a stand-alone,” meaning that it serves as a multiplier for the company’s other products.

Even while he doesn’t believe the company is completely protected from the effects of the recession, he maintains that the business is relatively shielded.

According to what he stated, “along those same lines, when macro concerns constrain growth in enterprise-software budgets, Microsoft might regard relative safety admission vital’ to companies, in some cases merging expenditure from longer-tail suppliers.” [Citation needed] “While severe economic difficulties would have an impact on its prospects, shallower forms of macro disruption are not expected to appreciably change the company’s trajectory,”

His objective of $300 is derived from a 30 times multiple of the expected enterprise value for the fiscal year 2023 in relation to free cash flow. That is lower than the average over the past three years, which, according to Marok, “accounts for robust developments in the industry that are slightly dampened by fears over the trajectory of corporate IT spend if economic conditions worsen.”

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