Microsoft (MSFT) Testing New High Ahead of Earnings Report

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Tech titan Microsoft (MSFT) reports fiscal third-quarter earnings April 24. The company reports after the market close with analysts forecasting earnings of $1.00 per share on sales of $29.83 billion. During the same period last year the company earned $0.95 on revenue of $26.82 billion.

Technical Analysis

MSFT was recently trading at $121.50 down $1.08 from its 12-month high and $31.22 above its 12-month low. InvestorsObserver’s Stock Score Report gives MSFT a 93 long-term technical score and a 98 short-term technical score. The stock has recent support above $112.5 and recent resistance below $122.5. Of the 22 analysts who cover the stock 20 rate it Strong Buy, 0 rate it Buy, 1 rate it Hold, 1 rate it Sell, and 0 rate it Strong Sell, MSFT gets a score of 88 from InvestorsObserver’s Stock Score Report.

Analysts' Thoughts

Microsoft has been a strong outperformer over the last several years, and the stock continues to trade to new highs. The company has emerged as the leader in the rapidly growing cloud computing space, and earnings have been on the rise. Profits are up 13% annually over the last five years and are expected to rise another 14.5% per annum over the next five years. The company reported a small earnings miss of a penny last quarter with revenues in-line with estimates but the market ignored the small miss and continued to push the stock higher as strength returned to the overall market after the December correction. The street expects Microsoft to post a positive earnings surprise for the recent quarter with a whisper number of $1.04. Look for updates on the company’s cloud growth, which will be a catalyst for the stock following the report. MSFT trades at 28 times earnings and analysts have an average price target of $126.76 on the stock.

About Microsoft Corporation

Microsoft develops and licenses consumer and enterprise software. It is known for its Windows operating systems and Office productivity suite. The company is organized into three overarching segments: productivity and business processes (legacy Microsoft Office, cloud-based Office 365, Exchange, SharePoint, Skype, LinkedIn, Dynamics), intelligence cloud (infrastructure- and platform-as-a-service offerings Azure, Windows Server OS, SQL Server), and more personal computing (Windows Client, Xbox, Bing search, display advertising, and Surface laptops, tablets, and desktops). Through acquisitions, Microsoft owns Xamarin, LinkedIn, and GitHub. It reports revenue in product and service and other revenue on its income statement.

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