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Morgan Stanley raises Microsoft, Google stock price targets after earnings

By: Invezz
analyst raises microsoft google stock price targets

Microsoft Corp (NASDAQ: MSFT) and Alphabet Inc (NASDAQ: GOOGL) have sharply rallied in the trailing twelve months but a Morgan Stanley analyst is convinced both still have significant room to the upside.

Microsoft stock has another 15% upside

Keith Weiss raised his price target on Microsoft stock this morning to $465 that translates to a near 15% upside from here.

His bullish call arrives a day after $MSFT reported better-than-expected results for its second financial quarter (read more). According to the Morgan Stanley analyst:

Q2 results well illustrated Microsoft’s leading position in Gen AI and unique ability to monetise this technology.

Microsoft is now calling for a 28% annualised growth in Azure in the current quarter. It expects a 1.0% to 2.0% increase in operating margin this year despite higher spending on cloud and artificial intelligence infrastructure.

Watch here: stock could climb to $165

Keith Weiss also reiterated his “overweight” rating on Google stock today. His new $165 price objective suggests a 15% upside in shares of the search giant as well.

The Nasdaq-listed firm reported its best quarter for revenue growth since early 2022 last night.

The Morgan Stanley analyst particularly cheered strength in the company’s “efficiency workstreams” in his research note on Wednesday that helped improve its EBIT/FCF “even with higher capex”.

More importantly, Sundar Pichai – the chief executive of Alphabet Inc said in the earnings release last night that the “best is yet to come” on the AI front as Invezz reported here.

Google repurchased $62b worth of stock.
Google also issued $22b worth of stock.
Net repurchase $40b.

Google's stock-based comp impact is 33%.
Microsoft's is 15%
Apple's is 10%.

— Joseph Carlson (@joecarlsonshow) January 30, 2024

The post Morgan Stanley raises Microsoft, Google stock price targets after earnings appeared first on Invezz

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