Davidson Investment Advisors Increases Microsoft Holdings

Davidson Investment Advisors has recently increased its investment in Microsoft Co. (NASDAQ:MSFT) by acquiring an additional 1,213 shares, marking a 0.6% increase in their stake during the second quarter, according to Holdings Channel.com. This brings their total ownership to 207,279 shares of the renowned software company, which now makes up approximately 4.8% of their overall portfolio. At the close of the recent reporting period, Davidson’s holdings in Microsoft were valued at around $92,643,000.

Other institutional investors and hedge funds have also been active in trading Microsoft shares. For instance, Warren Street Wealth Advisors LLC increased its stake by 16.5% in the fourth quarter, with a total of 6,767 shares now valued at $2,545,000 after adding 956 shares. Similarly, Czech National Bank raised its holdings by 0.4% in the first quarter, now owning 1,307,487 shares valued at $550,086,000 after buying an additional 5,253 shares. True Link Financial Advisors LLC notably expanded its position in Microsoft by 296.7% during the same quarter, bringing its total to 3,027 shares valued at $1,274,000. Other participants such as United Advisor Group LLC and AMG National Trust Bank have also increased their stakes in Microsoft, with institutional investors and hedge funds collectively owning approximately 71.13% of the company’s stock.

Microsoft Stock Overview

As of the most recent trading session, Microsoft shares opened at $416.32. The company holds a current ratio of 1.27, a quick ratio of 1.27, and a debt-to-equity ratio of 0.16. With a market capitalization of $3.09 trillion, Microsoft's price-to-earnings (P/E) ratio stands at 35.25, while its price-to-earnings growth (PEG) ratio is 2.22, indicating moderate growth expectations. The stock's performance shows a 50-day moving average of $417.92 and a 200-day moving average of $424.63, alongside a significant 12-month range, with a low of $324.39 and a high of $468.35.

On July 30th, Microsoft reported its earnings, showing an earnings per share (EPS) of $2.95 for the recent quarter, surpassing the anticipated estimate of $2.90. The revenue for the quarter stood at $64.73 billion, exceeding analyst expectations of $64.38 billion. This performance reflected a net margin of 35.96% and a return on equity of 35.95%, with a year-over-year revenue increase of 15.2%. Analysts project the company will achieve an EPS of 13.02 for the current fiscal year.

Share Repurchase Announcement

On September 16th, Microsoft’s board approved a significant share repurchase plan that allows the company to buy back $60 billion of its shares. This plan allows the company to repurchase approximately 1.9% of its outstanding shares on the open market, commonly indicating the board’s belief that the stock is undervalued.

Dividend Increase

In addition to the repurchase plan, Microsoft has announced a quarterly dividend of $0.83 per share, scheduled for payment on December 12th. Shareholders recorded as of November 21st will be eligible for this dividend, and the ex-dividend date is also November 21st. This amount reflects an annualized dividend of $3.32 and a yield of 0.80%. This is an increase from the prior quarterly dividend of $0.75, with a current payout ratio of 25.40%.

Insider Transactions

Recent insider activities at Microsoft include the sale of 40,000 shares by insider Bradford L. Smith on September 9th, with an average sale price of $402.59, totaling approximately $16,103,600. Following the sale, Smith retains ownership of 544,847 shares valued at about $219,349,953.73. Another notable insider sale was conducted by Chief Marketing Officer Takeshi Numoto, who sold 2,500 shares on September 10th for a total of $1,027,600. Recent insider transactions also reveal that there has been a total sale of 190,629 shares valued at about $77,916,485 over the last quarter, with insiders owning a mere 0.03% of the stock currently.

Analysts' Insights

Various brokerages have provided insights into Microsoft's stock performance. DA Davidson recently downgraded Microsoft from a “buy” to a “neutral” rating while establishing a price target of $475. Meanwhile, BMO Capital Markets raised their price target from $465 to $500 with an “outperform” rating. The Goldman Sachs Group adjusted their price target from $515 to $500, maintaining a “buy” rating. Other firms, like Citigroup and TD Cowen, also revised their price targets, with average estimates suggesting a moderate buy consensus and maintaining an average price target of $493.47.

About Microsoft Corporation

Microsoft Corporation is renowned for developing and providing an extensive range of software, services, devices, and solutions globally. Its Productivity and Business Processes segment includes popular products, such as Office, Microsoft Teams, and Microsoft 365, catering to both commercial and individual consumers.

Davidson, Investment, Microsoft