The Multiple Reasons Microsoft Stock is a Winner

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Iit is as usual for Microsoft (MSFT) in 2021, with the stock on an almost constant steady upward trajectory.

Looking Ahead, Tigress Analyst Ivan Feinseth expects the good times to continue, claiming that “the ongoing digital transformation, increasing cloud strength and new product introduction will continue to generate significant revenue and economic profit growth.”

In fact, the 5-star analyst not only reiterated a buy rating for MSFT stock, but also raised the price target from $ 303 to $ 366, which implies a 24% rise from current levels. (To look at Feinseth’s record, Click here)

There are several reasons for Feinseth’s optimistic outlook, including the rare occurrence of an upgrade to the tech giant’s PC operating system. Windows 11 rollout will begin on October 5, the first major upgrade in over six years.

“The new version of Windows will kick off a major PC and software upgrade cycle and provide integration with the next PC platform as a service hosted in MSFT’s Windows 365 cloud,” said the analyst.

Windows 365 is the company’s “latest evolution” in a complete cloud transition and offers a “complete computing experience hosted in the cloud”. It also offers “increased security” and allows users to stream access to all apps, tools and data “on any device”. Additionally, in today’s WFH environment, companies can support remote employees, including seasonal, temporary, intern and contract workers. Feinseth says migration to the cloud, increasing employment trends and “strong pricing power” will continue to favor Microsoft and notes that even moderate price increases can lead to significant revenue growth and “profitability gains”.

But that’s not all. Microsoft is also a force to be reckoned with in gaming. Developing its successful Game Pass subscription service later this year, MSFT will integrate its Xbox consoles into the Xbox Cloud Gaming streaming service, adding an additional option for mobile devices and desktops.

Feinseth says Xbox Cloud “eliminates the need for game downloads,” noting CEO Satya Nadella called it a “breakthrough experience.”

And finally, the icing on the cake is the company’s stellar balance sheet, which at the end of 2Q21 had a cash surplus of $ 127.96 billion – $ 17.00 per share.

“We expect MSFT to generate $ 124.19 billion in economic operating cash flow (EBITDAR) from NTM, which will continue to drive growth initiatives and strategic acquisitions as well as continued return. of liquidity to shareholders, ”said the analyst energetically.

Obviously, Feinseth’s colleagues also believe Microsoft is in a good position to deliver. The stock has a strong buy consensus rating, based on a unanimous 23 buy count. The forecast calls for year-over-year gains of around 14%, given that the average price target is currently $ 334.55. (See the analysis of Microsoft stocks on TipRanks)

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Disclaimer: The opinions expressed in this article are solely those of the analyst presented. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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