Piper Sandler Raises Microsoft Price Target to $540

Piper Sandler analyst Billy Fitzsimmons raised the price target on Microsoft (NASDAQ: MSFT) to $540.00 (from $500.00) while maintaining an Overweight rating.

“F3Q Azure growth came in at 39% y/y cc, a stronger beat than F2Q (1.5 pts vs. 1 pt in F2Q) and a modest acceleration on a tougher comp (F2Q: +38% y/y cc).

The real standout however is the F4Q Azure guidance mdpt of 39.5% y/y cc (well above consensus of 36.9%) coupled with a modest acceleration slated for C2H26 (supported by new capacity coming online).

We view the Azure guide as impressive given Azure’s size/scale. MSFT disclosed 20M Copilot users (~4.4% of the base), up from 15M in F2Q.

We ended up getting the expected capex increase with mgmt guiding to $190B for CY26.

The number aligns with tgts from hyperscaler competitors, and we believe the spend will help ensure MSFT can meet the strong demand.

MSFT remains one of our two top picks, well positioned to capitalize on both OpenAI and Anthropic’s growth. Increasing PT to $540.”

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