CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
We maintain our 12-month target at $407, based on a P/E of 30.7x our CY 25 EPS view, near its three- and five-year historical forward averages of 30.8x and 28.9x given our view of AI prospects. We hold our FY 24 (Jun.) EPS at $10.98 and FY 25 at $12.33. Ahead of Sep-Q earnings release set for 10/24, we see revenue growth of 8.8% ($54.5B) and EPS of $2.65. We think investors will be most interested to hear about commentary on Dec-Q guidance, updates on GenAI initiatives (sales/spending impact), and gaming outlook. For Dec-Q guidance, we see sales growth accelerating to +10%, on greater AI momentum and lapping steep Personal Computing declines. We project Azure growth of 26% in the Sep-Q (2 points from AI, up from 1 percentage point in the prior Jun-Q) with greater AI contribution for the Dec-Q (at least 3-4 points). We also look for more clarity/enterprise interest related to Microsoft 365 Copilot, which will be generally available on 11/1, as well as growth trajectory on the gaming side post-Activision deal.