Msft Stock Forecast 2025 – His Microsoft stock forecast article was written by Motek Moen Research, Alpha’s No. 1 Long Opinion Writer and No. 2 Technology Writer – Senior Analyst at I Know First.
Alphabet’s ( GOOGL ) failure to challenge Microsoft’s ( MSFT ) Azure and Office 365 is largely why MSFT is now trading well above $145. Alphabet’s G Suite productivity/collaboration app is more affordable than Microsoft’s Office 365. However, home and business users still prefer Office 365. Therefore, among the many best deals, you should definitely add more MSFT deals because Office 365 has more than 200 million monthly active users.
Msft Stock Forecast 2025
The overwhelming success of Office 365 over G Suite is why Microsoft remains number one in the $101 billion-a-year software-as-a-service (SaaS) industry. Enterprise SaaS is growing at a CAGR of 39% and Microsoft’s share is over 17%. I believe Alphabet’s share is less than 3%.
Microsoft Stock Forecast 2022, 2023, 2025, 2030
Despite G Suite’s cheaper business packages, Office 365 business growth (meaning enterprise customers) is still growing at 20%. Based on the chart below, Office 365 consumer or home users still number over 37 million.
G Suite reportedly ended 2018 with 5 million paying customers. Alphabet has never disclosed G Suite numbers, but I suspect it now has more than 7 million paying users. The big difference between the number of paying customers of Office 365 and G Suite is why you should prefer MSFT over GOOGL.
Yes, MSFT is now overvalued compared to GOOGL. Basically, Microsoft is recognized as the best investment. Unlike Microsoft, Google also doesn’t have a business social networking platform like LinkedIn. There are now more than 575 million registered users on LinkedIn. Of this number, 260 million are monthly active users. Most of them are probably paying customers of Microsoft Office or Office 365. Many companies that depend on Skype for Business and Dynamics 365 are unlikely to join Alphabet’s G Suite.
Microsoft Stock: Should Outperform Technology Peers (nasdaq:msft)
MSFT’s high valuation is that Microsoft is the king of the $450 billion-a-year software industry. Global software sales continue to account for an estimated $333 billion in annual digital advertising revenue. Using Office 365 is also not as vulnerable to privacy issues as Alphabet/Google’s advertising practices.
Going forward, both companies are very good investments. However, Microsoft is a safe long-term bet. My view is that SaaS annual growth will remain strong for the next 10 years. On the other hand, the growth of digital advertising will eventually slow down due to more people using ad blocking on their computers and mobile devices.
Furthermore, MSFT’s forward P/E of 32.34k is still lower than Adobe’s (ADBE)’s 49.08k. Adobe is a much smaller player than Microsoft when it comes to on-premise software and SaaS. Therefore, my bullish prediction is that MSFT can grow to a 34k forward P/E valuation before it reaches 2021. 34k forward P/E estimate multiplied by $6 EPS is $204. Therefore, it is reasonable to give MSFT a 12-month price target of $205.
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MSFT could actually hit $200 in the next 12 months if the $10 billion JEDI deal attracts more government/enterprise customers to Azure. Last year, cloud computing infrastructure spending reached $96 billion. Microsoft now has 18% of its market share – second only to AWS’s 33% share. Google Cloud is still less than 10%. Azure’s future growth potential is therefore another strong tune. Cloud computing infrastructure is expected to grow to a $384 billion business annually by 2025.
Study the chart below, Microsoft Azure is enjoying a higher annual growth rate than Google Cloud and AWS. It is inevitable that Azure will increase its advantage over Google Cloud.
I expect Azure to end 2021 with a 20% share of cloud computing infrastructure. AWS will probably end up with 30% and Google with 8%. Google Cloud also tried to bid on the JEDI contract, but no government leader would hand over national security-level cloud computing infrastructure to Google, which specializes in collecting personal data.
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Trump’s distaste for Bezos aside, the US government chose Azure over Amazon’s ( AMZN ) AWS because it apparently felt it was better and/or more cost-effective. Trump acquitted of impeachment charges. He will probably win a second time. If this turns out to be true, I expect Azure to win more cloud computing contracts from the US government.
Microsoft’s large cash reserves also give it plenty of room to grow its edge in business SaaS. As of December 31, 2019, Microsoft’s cash and cash equivalents are over $134 billion. Microsoft could easily buy a 51% controlling stake in other leading SaaS companies like Adobe or Salesforce (CRM).
If antitrust regulators don’t allow Microsoft to buy more SaaS companies, much of that $134 billion could be used to buy back shares and/or pay higher dividends. Over the past fiscal year, Microsoft has spent more than $30.26 billion on stock buybacks. Microsoft plans to spend another $40 billion on acquisitions. The buyback and higher profits ultimately lead to a higher stock price for Microsoft. That fact alone should push my 12-month price target to $205.
Microsoft Corp. Research & Ratings
MSFT already has a +74% 1-year price return, but I know First still has a 12-month market trend forecast. This should convince you that MSFT has a high probability of crossing $200 before the end of 2020.
And the first thing you should know is that MSFT stock has been on the lookout lately. On February 3, 2019, I know the first algorithm has provided stock market predictions for MSFT for long time horizons. As we can see today, the algorithm has successfully predicted the price movement of MSFT – so far Microsoft is up about 70% according to the “first I know” algorithmic trading forecast.
Here’s the first thing I know, our algorithm has modeled and produced market forecasts for about 10,500 assets worldwide for short and long time horizons, from 3 days to a year. Since 2011, we’ve been providing daily S&P 500 forecasts, forex forecasts, gold price forecasts, Apple stock forecasts and more. Highly regarded by institutional clients as well as private investors and traders, it helps identify the best investment opportunities in the market.
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Of the mega-cap names ($500 billion plus), Microsoft (NASDAQ: MSFT ) stock has had the most performance in 2020. This came as a bit of a surprise, as many stocks were struggling to stay afloat during the same period. Not only did Microsoft increase its market value in 2020, it also delivered impressive quarterly earnings in the first quarter of 2021.
Most investors would agree that MSFT is not going away anytime soon. The range of products, as well as subscription-based services, lay a strong foundation for sustainable revenue generation in the future as well.
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On such a positive note, how high could Microsoft stock go in 2021? And in 10 years? Find out in this Microsoft stock price forecast!
Microsoft Corporation operates in the Technology Services sector. The company develops, licenses and supports a range of products, services, tools and solutions. In particular, proposals are made around areas such as manufacturing and business processes, intelligent cloud, and personal computing.
The first time investors could acquire Microsoft as a public company was in 1986, led by Bill Gates. MSFT’s share price was $21, which, adjusted for future dividends, was about 7.2 cents.
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In 2014, longtime Microsoft CEO Satya Nadella became the third CEO in the company’s history, following Steve Ballmer. The current price for MSFT stock on 01/18/2023 is $236.49.
In general, most stocks are affected by the same factors, including supply and demand, company news and performance, current domestic and international events, and investor sentiment.
However, in this section, we will take a closer look at several of the main factors affecting MSFT stock estimates.
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As higher earnings boost stock prices, investors are eager to see the success of any product launch. This applies not only to long-term investments, but also to stock trading performance.
Recent and upcoming acquisitions can also shed light on where the stock is headed. Assuming Microsoft is pushing them in the right direction, here are just a few examples of where the company is trying to strengthen its position:
Cloud usage was so high in 2020 that Microsoft is slowing down some “non-essential” Office 365 services. Following commercial successes with private companies and a $10 billion deal with the US Department of Defense, this strong demand is likely to continue. As long as Microsoft continues to scale to meet demand, the stock market cap should rise.
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Top analysts have shared their price targets for Microsoft stock and informed clients of their buy or sell ratings.
Jefferies Financial Group reduced their price target on Brent Oil from $300.00 to $290.00 in a recent report. The analyst noted that the move was a valuable call. The company currently maintains a strong buy rating on the stock.
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Microsoft Is The Ultimate Wonderful Company At A Fair Price (nasdaq:msft)
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