Microsoft (NASDAQ:MSFT) Shares Down 2% – Should You Sell?

Microsoft Corporation (NASDAQ:MSFT) shares traded down 2% on Friday . The company traded as low as $380.12 and last traded at $381.3450. 49,659,261 shares were traded during mid-day trading, an increase of 37% from the average session volume of 36,204,051 shares. The stock had previously closed at $389.02.

Microsoft News Summary

Here are the key news stories impacting Microsoft this week:

• Positive Sentiment: OpenAI tie-up is driving new customer wins and adoption of Microsoft AI products, supporting recurring revenue growth and Copilot monetization. How Microsoft’s (MSFT) OpenAI Partnership Is Bringing in a New Wave of Customers
• Positive Sentiment: Analysts point to an AI-fueled Azure surge and a large enterprise backlog (reported as a material competitive edge vs. peers like Adobe), supporting medium-term revenue upside. Microsoft vs. Adobe: Which Software Giant Has Better Upside Potential?
• Positive Sentiment: Strategic partner activity (e.g., Accenture collaborations and ecosystem integrations) reinforces Microsoft’s position in enterprise security and AI services, which can deepen customer stickiness and drive incremental services revenue. Accenture Expands AI-Driven Cybersecurity Capabilities with Microsoft Partnership
• Neutral Sentiment: Traders and retail investors are seeing increased options activity and yield strategies (but these are tactical, not fundamental). Some traders propose structured trades (butterfly, income ETFs) to play the pullback. Transform Microsoft Stock Weakness Into A $1,700 Payoff With A Butterfly Trade
• Neutral Sentiment: Large-cap active ETFs continue to hold Microsoft as a core position, which can stabilize flows even during sell-offs (institutional ETF flows are a background influence on demand).
• Negative Sentiment: OpenAI exclusivity appears at risk as OpenAI talks with Amazon, and reports say Microsoft is considering legal action — a potential breakdown of the partnership would materially weaken MSFT’s AI moat and Azure demand assumptions. Microsoft Weighs Legal Fight As OpenAI Amazon Talks Test Azure Edge
• Negative Sentiment: Policy/contract changes in local government dealings (NDAs and procurement) have been cited as a trigger for some municipal and public-sector deals to slow, which analysts say pressured the stock in intraday trading. No More NDAs: Microsoft Stock (NASDAQ:MSFT) Slumps After Change in Local Government Dealings
• Negative Sentiment: Security incidents continue to create headlines: a U.S. agency urged firms to harden a Microsoft endpoint tool after the Stryker attack, and reports of SharePoint being used as an attack vector raise enterprise risk and potential remediation costs. These keep risk-premiums elevated for MSFT. US agency asks companies to secure Microsoft tool after Stryker cyberattack
• Negative Sentiment: Investors remain concerned about rising infrastructure and AI compute costs that have pressured margins despite solid top-line beats; commentary that the stock has been “slammed” this year reflects worry about near-term margin compression and valuation re-rating. Microsoft Stock Has Been Absolutely Slammed This Year. Is It Finally Time to Buy?

Analyst Ratings Changes

MSFT has been the topic of a number of research analyst reports. Wolfe Research lowered their price objective on shares of Microsoft from $625.00 to $530.00 and set an “outperform” rating on the stock in a research report on Thursday, January 29th. New Street Research increased their target price on shares of Microsoft from $670.00 to $675.00 and gave the stock a “buy” rating in a research report on Thursday, January 29th. Oppenheimer reissued an “outperform” rating on shares of Microsoft in a research note on Thursday, January 29th. Morgan Stanley restated an “overweight” rating on shares of Microsoft in a report on Thursday, January 29th. Finally, William Blair reiterated an “outperform” rating on shares of Microsoft in a report on Monday, March 9th. Two equities research analysts have rated the stock with a Strong Buy rating, thirty-nine have issued a Buy rating and four have assigned a Hold rating to the company. Based on data from MarketBeat, Microsoft presently has a consensus rating of “Moderate Buy” and an average price target of $591.87.

Microsoft Price Performance

The company has a quick ratio of 1.38, a current ratio of 1.39 and a debt-to-equity ratio of 0.09. The company has a market capitalization of $2.83 trillion, a P/E ratio of 23.85, a P/E/G ratio of 1.49 and a beta of 1.10. The company’s 50-day simple moving average is $418.85 and its 200 day simple moving average is $472.02.

Microsoft (NASDAQ:MSFT) last announced its quarterly earnings results on Wednesday, January 28th. The software giant reported $4.14 EPS for the quarter, topping the consensus estimate of $3.86 by $0.28. Microsoft had a net margin of 39.04% and a return on equity of 32.34%. The company had revenue of $81.27 billion for the quarter, compared to analyst estimates of $80.28 billion. During the same quarter in the prior year, the business posted $3.23 EPS. Microsoft’s quarterly revenue was up 16.7% on a year-over-year basis. As a group, sell-side analysts expect that Microsoft Corporation will post 13.08 earnings per share for the current fiscal year.

Microsoft Announces Dividend

The firm also recently announced a quarterly dividend, which will be paid on Thursday, June 11th. Shareholders of record on Thursday, May 21st will be given a dividend of $0.91 per share. This represents a $3.64 annualized dividend and a yield of 1.0%. The ex-dividend date of this dividend is Thursday, May 21st. Microsoft’s dividend payout ratio is presently 22.76%.

Insider Activity

In other Microsoft news, EVP Kathleen T. Hogan sold 12,321 shares of the business’s stock in a transaction dated Friday, March 6th. The stock was sold at an average price of $409.52, for a total value of $5,045,695.92. Following the completion of the sale, the executive vice president owned 137,933 shares of the company’s stock, valued at $56,486,322.16. The trade was a 8.20% decrease in their ownership of the stock. The sale was disclosed in a filing with the Securities & Exchange Commission, which is available at this hyperlink. Also, Director John W. Stanton purchased 5,000 shares of the firm’s stock in a transaction dated Wednesday, February 18th. The shares were bought at an average price of $397.35 per share, with a total value of $1,986,750.00. Following the purchase, the director owned 83,905 shares in the company, valued at $33,339,651.75. This represents a 6.34% increase in their position. Additional details regarding this purchase are available in the official SEC disclosure. 0.03% of the stock is owned by company insiders.

Hedge Funds Weigh In On Microsoft

Several hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. IRON Financial LLC lifted its holdings in Microsoft by 23.2% during the 3rd quarter. IRON Financial LLC now owns 6,510 shares of the software giant’s stock worth $3,372,000 after buying an additional 1,225 shares in the last quarter. Wellington Capital Management Inc. bought a new position in Microsoft in the 2nd quarter valued at $9,941,000. Sound View Wealth Advisors Group LLC increased its stake in shares of Microsoft by 2.6% in the 2nd quarter. Sound View Wealth Advisors Group LLC now owns 94,120 shares of the software giant’s stock valued at $46,816,000 after buying an additional 2,373 shares during the period. Trifecta Capital Advisors LLC raised its position in shares of Microsoft by 2.3% during the third quarter. Trifecta Capital Advisors LLC now owns 70,175 shares of the software giant’s stock worth $36,347,000 after acquiring an additional 1,572 shares during the last quarter. Finally, Weaver Capital Management LLC raised its position in shares of Microsoft by 14.0% during the third quarter. Weaver Capital Management LLC now owns 18,340 shares of the software giant’s stock worth $9,499,000 after acquiring an additional 2,247 shares during the last quarter. Institutional investors and hedge funds own 71.13% of the company’s stock.

Microsoft Company Profile

Microsoft Corporation is a global technology company headquartered in Redmond, Washington. Founded in 1975 by Bill Gates and Paul Allen, Microsoft develops, licenses and supports a broad range of software products, services and devices for consumers, enterprises and governments worldwide. Its operations span personal computing, productivity software, cloud infrastructure, enterprise applications, developer tools and gaming.

Microsoft’s product portfolio includes the Windows operating system and the Microsoft 365 suite of productivity and collaboration tools (Office apps, Outlook, Teams).