On May 15, Citi increased its price target on Microsoft Corporation (MSFT) to $540 from $480 while keeping a Buy rating on the shares.
The bank raised its estimates for Microsoft’s cloud unit, Azure, and is upbeat on its AI offerings. Citi also reacted positively to Microsoft Corporation (MSFT)’s decision to lay off 3% of its workforce.
Why Citi Is Bullish on Microsoft Corporation (MSFT)
The bank pointed out that MSFT had expressed confidence in the demand for its cloud products and reported that it plans to increase its capital spending going forward. As a result, Citi raised its estimates for MSFT’s cloud unit, Azure. The bank now expects Azure’s sales to surge at least 30% in MSFT’s fiscal 2026.
Citi also believes that the company’s layoffs will improve its financial results.
Finally, the bank asserts that Microsoft Corporation (MSFT) remains a leader in generative AI.
The Recent Performance of MSFT Stock
In the last three months, the stock has gained 11%, while it has soared 24% in the last month.
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This article is originally published at Insider Monkey.
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