12:40 PM EDT, 07/31/2025 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
We raise our 12-month target to $620 from $550, on a P/E of 33x our CY 2027 view of $18.73, above historical given our view of growth prospects tied to AI monetization. After posting better-than-expected Jun-Q results, we increase our FY 26 (Jun.) EPS estimate to $15.36 from $14.93 and FY 27 to $17.96 from $17.40. We are incredibly impressed by Azure growth acceleration, which we think is being partly attributed by greater usage of more complex reasoning models, as well as AI momentum across its productivity businesses given the increasing adoption that MSFT is seeing for its CoPilot tools across the enterprise space. In addition, similar to META, the company is executing extremely well on margins, as it looks to minimize headcount additions in favor of capex growth. Despite higher capex spend for Sep-Q ($30B), we expect the ROI of AI spend to improve through CY 2027, with greater revenue potential as MSFT shifts a greater allocation of spend toward servers. We view our forward estimates as conservative.