Bank of America Securities analyst Bradley Sills reiterated a Buy rating on Microsoft (MSFT – Research Report) yesterday and set a price target of $510.00.
Bradley Sills has given his Buy rating due to a combination of factors that highlight Microsoft’s strategic positioning and commitment to long-term growth. Despite reports of potential adjustments in data center leases and spending reallocations, Microsoft remains steadfast in its capital expenditure plans, particularly in AI and cloud infrastructure. The company’s unchanged $80 billion capex plan for FY25 underscores its dedication to building robust infrastructure for the future.
Additionally, Microsoft’s willingness to share the capital expenditure burden for AI infrastructure with partners like Oracle and Softbank reflects a strategic approach to resource allocation. This move aligns with CEO Satya Nadella’s vision of a distributed infrastructure build across major hyperscalers, similar to the cloud cycle. The right of first refusal terms in the OpenAI partnership further supports Microsoft’s strategy to diversify its infrastructure commitments while maintaining a strong position in the AI space. These factors collectively justify the Buy rating, indicating confidence in Microsoft’s growth trajectory and market leadership.
In another report released yesterday, Bernstein also maintained a Buy rating on the stock with a $511.00 price target.