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Investing.com - Barclays has reiterated an Overweight rating and $625.00 price target on Microsoft (NASDAQ:MSFT) following the company’s announcement of price increases for its Office and Microsoft 365 subscriptions. The target represents significant upside from Microsoft’s current trading price of $480.84, with InvestingPro data showing the stock is currently trading at Fair Value. The tech giant commands a massive $3.57 trillion market cap, making it one of the world’s most valuable companies.
The price hikes, which will affect commercial customers, are set to take effect on July 1, 2026, marking Microsoft’s second subscription price increase since the original launch of Office 365 in 2011, with the previous increase occurring in 2022.
Microsoft justified the price adjustment by pointing to the addition of 1,100 new features across Microsoft 365, Security, Copilot, and SharePoint over the past year. This innovation-driven approach has helped fuel Microsoft’s impressive 15.59% revenue growth over the last twelve months, with total revenue reaching $293.81 billion.
The Microsoft 365 F1 subscription will see the largest increase at 33%, a segment that Barclays notes has high net seat expansions.
Barclays views this development as reinforcing Microsoft’s artificial intelligence-driven pricing leverage, supported by steady enterprise demand for the company’s products. This optimism is echoed by the broader analyst community, with InvestingPro data showing 26 analysts have revised their earnings upwards for the upcoming period. The most bullish analysts have set a price target of $730, reflecting confidence in Microsoft’s growth trajectory. For comprehensive analysis of Microsoft and 1,400+ other top stocks, check out the Pro Research Reports available on InvestingPro.
In other recent news, Microsoft announced it will increase prices for its Office productivity software subscriptions for commercial and government clients starting July 1. The price adjustments will affect various subscription tiers, with some increases reaching as high as 33% for front-line worker packages. Additionally, Microsoft has declared a quarterly dividend of $0.91 per share, payable on March 12, 2026, to shareholders of record on February 19, 2026. DA Davidson has reiterated its Buy rating on Microsoft stock, maintaining a price target of $650, despite concerns about OpenAI’s viability. The firm highlighted the significant contribution of OpenAI to Microsoft’s business. Meanwhile, OpenAI has developed a new "confessions" method for its GPT-5 model to enhance transparency in AI systems. OpenAI also announced a definitive agreement to acquire Neptune, a startup specializing in tools for analyzing AI model training progress, through a stock transaction. The financial terms of this acquisition have not been disclosed.
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