Oppenheimer just lifted its view on Microsoft (MSFT, Financial) and now tags it as an Outperform with a six-hundred-dollar price target. They believe the stock has room to run once investors fully appreciate how AI is fueling Azure's growth.
Brian Schwartz and his team point out that cloud and AI revenue aren't fully reflected in today's share price. They compare Azure's trajectory to how AWS has supported Amazon's valuation for years and expect new tools like Copilot Studio to spark another wave of enterprise spending.
What really caught their eye is Microsoft's rare mix of fast expansion and healthy profit margins. This Rule of Sixty combination at such a massive scale is something few companies can pull off and it underpins their case for a premium multiple.
Even though the first roll-out of Copilot didn't quite live up to the hype, Oppenheimer thinks the next generation of AI offerings will drive more sustained usage and revenue. That optimism has the stock trading higher in premarket action as investors weigh the potential upside.
If Microsoft hits its stride with these AI initiatives, the path to that six-hundred-dollar target looks much more attainable. It's a story about long-term leadership in software rather than short-term hype.
