Raymond James Raises Microsoft Price Target to $650

Raymond James analyst Andrew Marok raised the price target on Microsoft (NASDAQ: MSFT) to $650 (from $630) while maintaining an Outperform rating.

“We reiterate our Outperform rating and raise our price target to $650 after Microsoft delivered a strong F1Q27, headlined by Azure growth of 48% y/y CC, ahead of our sense of investor expectations of 45%, with the F2Q27 guide for 49–50% representing further upside.

We view the performance as encouraging, particularly with management continuing to find ways to monetize existing capacity more efficiently despite ongoing supply constraints.

The company also benefited from higher-than-expected revenue per token, while delays in third-party capacity deliveries pushed capex below expectations.

Although these improvements suggest that Microsoft is making meaningful progress on returns from its infrastructure investments, their timing remains difficult to forecast, and spending is expected to accelerate in fiscal 2H27.

Elsewhere, M365 commercial cloud growth was solid, though weaker execution in lower-tier products and the lack of an updated Copilot seat figure temper a bit of the enthusiasm.

We maintain our constructive view on the company’s positioning, with the quarter likely to sustain the improved sentiment following last quarter’s positive reset.”

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