Wall Street Says Microsoft Can Hit $650. Here’s the Path

2 hours ago 2

Jeremy Phillips

Sat, December 13, 2025 astatine 2:00 PM CST 4 min read

24/7 Wall St.

Microsoft bushed gross estimates by $2.3B with Azure increasing 40% year-over-year.
56 of 57 analysts complaint the banal a bargain with a statement people of $625.41.
Reaching $650 requires a 35.7% summation and would worth shares astatine 41x guardant earnings.
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Microsoft (NASDAQ: MSFT) has delivered coagulated returns successful 2025, but shares stay beneath their 52-week precocious of $553.50. The banal presently trades astir $479.

Despite the pullback, fundamentals stay robust. Microsoft reported gross of $77.67 cardinal successful its astir caller quarter, beating estimates by astir $2.3 cardinal and marking 18.4% year-over-year growth. Azure grew 40% arsenic enterprises accelerate integer transformation.

CEO Satya Nadella continues positioning Microsoft astatine the halfway of the AI revolution, with Copilot AI assistants embedded crossed its productivity suite. With momentum gathering astir AI monetization and unreality growth, investors are wondering however precocious shares could ascent successful 2026.

Analysts are decidedly bullish. The statement 12-month terms people sits astatine $625.41, implying 30.5% upside from existent levels. That optimism reflects beardown conviction: 56 of 57 analysts covering the banal complaint it a bargain oregon beardown buy, with conscionable 1 clasp standing and zero sells.

This near-unanimous enactment stems from Microsoft's awesome maturation trajectory. Wall Street expects gross maturation to proceed successful the precocious teens, driven by Azure's enlargement and expanding AI adoption crossed endeavor customers. Earnings per stock estimates person been climbing, with analysts forecasting continued double-digit net maturation arsenic Microsoft scales its AI infrastructure investments. The institution has beaten net expectations successful 11 of the past 12 quarters, suggesting existent results volition apt transcend forecasts.

At today's terms of $479, Microsoft trades astatine astir 30x guardant earnings. At $650, shares would commercialized astatine astir 41x guardant earnings. That represents a premium valuation, but it's not entirely unreasonable for a institution increasing net astatine 12.7% annually portion maintaining a 48.9% operating borderline and 35.7% nett margin.

The S&P 500 trades astir 22x guardant earnings, meaning Microsoft would bid astir treble the marketplace multiple. However, Microsoft's operation of scale, profitability, and maturation justifies a premium. The institution generated $293.81 cardinal successful trailing gross portion posting a 32.2% instrumentality connected equity.