By Sam Boughedda
Stifel analysts raised the firm's price target on Microsoft (NASDAQ:MSFT) to $310 from $290 per share in a note Friday, maintaining a Buy rating on the stock.
Looking ahead to the company's upcoming earnings release, the analysts said Microsoft's Q3 results on April 25 after the close, are likely to be somewhat of a mixed bag due to PC and per-seat headwinds, while EMS and Office Licenses have pushed Stifel to modestly lower its current and future top-line estimates.
On the flip side, Stifel expects MSFT management's continued focus on operational discipline and higher-than-anticipated other income to offset most of the headwinds.
"The biggest wildcard remains where/when the Azure IaaS growth rate stabilizes," the analysts wrote. "We currently expect this during 2HCY23 in the mid 20% range (low 20%s for Azure all up), but clearly, should the economic environment meaningfully degrade from here, the timing/rate of stabilization could push-out into CY24."
"Looking forward, a year ago management provided its early FY23 double-digit top and bottom-line commentary, but we expect a less granular forward guide focused on OPEX vs revenue growth given the ongoing uncertainties within the global economy."