TD Cowen Sees Microsoft (MSFT) Shares Range-Bound Ahead of Earnings

Microsoft Corporation (NASDAQ:MSFT) is one of the AI Stocks on Market Radar. On January 20, TD Cowen lowered its price target on the stock to $625 from $655 and maintained a Buy rating. The price target cut comes ahead of Microsoft’s Q2 results, with the firm flagging capacity constraints as a limiting factor for growth acceleration.

The firm previewed its results, stating that checks suggest demand for GPU and CPU infrastructure is stable or strengthening. It anticipates about 2 points of upside to their 37% cc Azure estimates.

TD Cowen also suspects that a lack of growth acceleration, primarily stemming from capacity constraints, will keep shares range-bound in the near-term. However, it remains constructive for the company’s position to serve AI workloads.

We suspect lack of growth acceleration due to capacity constraints will keep shares range-bound NT, but we remain constructive on MSFT’s position to serve AI workloads & see a potential for acceleration in 2HCY26. Reiterate Buy. PT to $625.

Microsoft reports its earnings on January 28. TD Cowen believes Microsoft is poised for AI growth with possible reacceleration in the second half of 2026.

Microsoft Corporation (NASDAQ:MSFT) provides AI-powered cloud, productivity, and business solutions, focusing on efficiency, security, and AI advancements.

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