Microsoft jumps premarket as cloud surge, softer capex outlook fuel investor optimism
MSFT•Microsoft shares rise in premarket trading
Shares of software and cloud giant Microsoft MSFT.O rise nearly 8% to $420.02 premarket.
Cloud growth and capex outlook lift sentiment
The company on Wednesday said it expects to keep generating cash through its just-started fiscal 2027 and gave a capital expenditure forecast below Wall Street estimates after an accounting change for data center leases.
Barclays cuts its price target to $512 from $545 and maintains an "overweight" rating, saying the company is delivering better Azure and finally better Office growth, while also not surprising negatively on its capex outlook and free cash flow targets.
"Given the different set-up for other main players (larger AI investments), we see a positive reaction" - Barclays.
Azure beats estimates as stock lags peers this year
Azure revenue rises 43% in fiscal fourth quarter, topping analyst estimate of 39.98%.
The company is among the worst performers in the so-called "Magnificent Seven" group of mega-caps with an 18% drop so far this year, trailing cloud rivals such as Alphabet GOOGL.O.
Sixty-three analysts rate the stock on average; median PT is - data compiled by LSEG.
