First Interstate Bank Reduces Its Stake in Microsoft Co. (NASDAQ:MSFT)

First Interstate Bank has decreased its stake in Microsoft Co. (NASDAQ:MSFT) by 1.3% during the second quarter, according to its latest filing with the Securities and Exchange Commission (SEC). The bank now holds 47,718 shares of the tech giant's stock after selling 639 shares in this period. Microsoft represents around 1.4% of First Interstate Bank's total holdings, making it the firm's 15th largest investment. As per the latest SEC filing, the bank's Microsoft shares are valued at approximately $21,328,000.

Other institutional investors and hedge funds have also altered their positions in Microsoft recently. For instance, Christopher J. Hasenberg Inc increased its holdings by 169.2% in the second quarter, now owning 70 shares valued at around $31,000 after acquiring an additional 44 shares. Richardson Capital Management LLC saw a remarkable boost of 1,290.0% during the first quarter, and they currently possess 139 shares worth $59,000, having added 129 shares recently. Innealta Capital LLC made a new investment in Microsoft in the second quarter, valued at $75,000. Bellevue Group AG has also increased its position in Microsoft by 47.5% during the first quarter, now holding 180 shares valued at $76,000 after purchasing an additional 58 shares. Lastly, Horizon Financial Services LLC made a new stake in Microsoft valued at $80,000 during the first quarter. Overall, institutional investors maintain a collective 71.13% ownership in the company.

Brokerage Assessment

Several brokerages have provided updates regarding Microsoft stock. For example, Wells Fargo & Company reaffirmed a "buy" rating for Microsoft on October 18th. On July 12th, BMO Capital Markets raised its target price on Microsoft from $465.00 to $500.00 and labeled the stock as "outperform." TD Cowen similarly increased its price target from $470.00 to $495.00 with a "buy" rating on July 18th. Meanwhile, Piper Sandler lowered its target price from $485.00 to $470.00, assigning an "overweight" rating on October 18th. Additionally, Truist Financial maintained its "buy" rating for Microsoft and set a price target of $600.00 on October 8th. Notably, only one equity analyst has rated the stock as a sell; while three categorized it as a hold, an overwhelming twenty-eight analysts rated it as a buy. According to data from MarketBeat.com, Microsoft has a consensus rating of "Moderate Buy" with an average target price of $495.94.

Microsoft's Stock Performance

As of Friday, MSFT shares opened at $428.15. Over the past year, Microsoft has fluctuated, with a 52-week low of $326.94 and a high of $468.35. Currently, the firm has a 50-day moving average of $420.40 and a 200-day moving average of $424.56. Financial indicators show a quick ratio of 1.27, a current ratio of 1.27, and a manageable debt-to-equity ratio of 0.16. The company's market capitalization stands impressively at $3.18 trillion, with a PE ratio of 37.07 and a price-to-earnings-growth (PEG) ratio of 2.24.

Recent quarterly earnings from Microsoft, announced on July 30th, highlighted the company's strength, reporting $2.95 earnings per share (EPS), which surpassed analysts' estimates of $2.90 by $0.05. The company generated revenue of $64.73 billion during that quarter, exceeding analysts' forecasts of $64.38 billion. Microsoft achieved a return on equity of 35.95% along with a net margin of 35.96%, reflecting a notable 15.2% revenue increase from the same quarter of the previous year, where it reported an EPS of $2.69. Expectations indicate that Microsoft will post 13.02 EPS for the current fiscal year.

Dividend Increase and Stock Buyback Plan

Microsoft has also announced an increase in its quarterly dividend, which is set to be paid on December 12th. Shareholders on record as of November 21st will receive a $0.83 dividend, following the ex-dividend date of the same day. This represents an annualized dividend of $3.32 and a yield of 0.78%, an increase from the previous dividend of $0.75. Currently, Microsoft's dividend payout ratio is at 28.74%.

Additionally, on September 16th, Microsoft's Board of Directors authorized a stock buyback plan that allows for the purchase of up to $60.00 billion of the company's outstanding shares. This plan signals management's confidence in the company's value and suggests that they believe the stock is currently undervalued.

Insider Movements

In the realm of insider activities, Microsoft’s Chief Marketing Officer, Takeshi Numoto, sold 2,500 shares on September 10th, receiving about $1,027,600 from these transactions, which were conducted at an average price of $411.04 per share. Post-transaction, Numoto owns 50,000 shares valued at approximately $20,552,000. Similarly, insider Bradford L. Smith sold 40,000 shares on September 9th, gaining roughly $16,103,600 from this sale at an average selling price of $402.59. Following this sale, he retains 544,847 shares valued at about $219,349,953.73. Over the past three months, insiders have collectively sold 190,629 shares worth $77,916,485, and currently, insiders own about 0.03% of the company's stock.

Understanding Microsoft

Microsoft Corporation is a global leader in developing and supporting various software, services, devices, and solutions. Its Productivity and Business Processes segment includes Microsoft Teams, Office 365, SharePoint, Microsoft Viva, and other services.

Microsoft, Investing, Stocks