Microsoft stock poses risk of Windows slowdown, analyst warns

Analysts are generally positive on Microsoft Corp.’s MSFT stock,
+1.70%,
but Guggenheim analyst John DiFucci just became one of only three analysts tracked by FactSet to issue a neutral rating on the stock. The other 43 analysts polled by FactSet who cover Microsof rate the name as equivalent to a buy. DiFucci anticipates continued “hyper growth rates” for Microsoft’s Azure cloud computing business, but he’s more concerned about the near-term landscape of the company’s Windows business. “Despite evidence of the impact of the weaker PC market on Windows in F4Q22, we still see near-term risk to Windows consensus estimates,” DiFucci wrote. He added that while Windows “isn’t impacting revenue as much as it used to, it still accounts for almost a quarter of total operating profit, which creates more risk to estimates. net income”. Microsoft “will not be immune to the cyclical nature of demand,” according to DiFucci. He set a price target of $292 on the stock, which closed Thursday at $287.02. He recently initiated coverage of a number of software stocks in addition to Microsoft, and he instituted sell ratings on a number of big names, including Salesforce Inc. CRM,
+1.69%
and Snowflake Inc. SNOW,
+0.48%.
Microsoft shares have gained 12% in the past three months as the Dow Jones Industrial Average DJIA,
+1.27%
increased by about 5%.