CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
We increase our 12-month target price to $475 from $455 based on a P/E of 33x our CY 25 view, above historical, as we see upside to forward expectations related to an improving AI growth trajectory/high visibility. We raise our FY 24 (Jun.) EPS estimate to $11.74 from $11.56 and FY 25 to $13.43 from $13.04. We start FY 26 at $15.39. Ahead of Mar-Q results expected on 4/23, we look for EPS of $2.84 on 15% revenue growth. We think all eyes will be on Azure, which we see growing 29%, with 6 to 8 percentage points of AI contribution. Any insights on Microsoft 365 Copilot adoption will also be monitored (first full quarter), as we do expect to hear positive commentary and see positive contribution via higher ARPU within its Office Commercial business. Within Personal Computing, we expect growth of 14% as Activision continues to act as a positive tailwind on segment revenue. Despite elevated spend, operating efficiencies point to margin expansion through FY 26 as scale benefits are seen from cloud/AI investments.