MSFT - current pullback set stage for explosive upswingMassive upswing approaching as pullback hits strong 150days SMA support
MSFT trade ideas
Is MSFT Stock A Buy, Sell, or Hold?MSFT is one of the few tech stocks which trades close to all-time highs, seemingly oblivious to the brutal valuation reset that swept through the sector
In the most recent quarter, MSFT delivered strong results when factoring in the tough macro environment. MSFT grew revenues by 7% (10% constant currency) and earnings per share by 10% (14% constant currency) - two achievements not necessarily typically seen under difficult economic circumstances.
MSFT generated $8.64 billion of that operating income from its productivity and business processes segment, which houses its Office 365 product suite among others. As to be expected, LinkedIn revenue growth came in light at just 8%, a reflection of lower hiring demand.
MSFT generated another $9.4 billion in operating income from its intelligent cloud segment. Azure grew at a 27% clip, far surpassing the 16% growth seen at competitor Amazon Web Services
Investors have been cautious on the ever-valuable cloud business ever since the cloud titans all revealed cloud optimization efforts undertaken by its customers. On the conference call, management implied that they may see easing headwinds as they pass the anniversary of those optimization efforts, stating that “at some point, workloads just can't be optimized much further.” It is possible that MSFT’s partnership with ChatGPT’s creator OpenAI has something to do with that, as management noted that while they do not consolidate any operating losses due to them holding a minority equity interest, they do indeed recognize revenues generated from OpenAI using their cloud services. The other cloud titans did not offer the same bullish commentary surrounding the end of cloud optimization.
MSFT continued to see headwinds from its more personal computing segment, which saw revenues decline by 9% though still managed to generate $4.24 billion in operating income. At some point the comps should become easier here, but that may still be a couple of quarters away.
MSFT ended the quarter with $104.5 billion in cash versus $48.2 billion in debt. I note that the company also has another $9.4 billion in equity investments (the announced $10 billion investment in OpenAI is set to take place in parts throughout the year).
The company continues to pay a growing dividend and conducted $5.5 billion in share repurchases in the quarter. It is not too often that one can get long term innovation and have the majority of free cash flow returned to shareholders as well.
Looking ahead, management has noted that overall growth may struggle due to the prior year’s quarter being a tough comp, with that being their “largest commercial bookings quarter ever with a material volume of large multiyear commitments.” Management did, however, guide for up to 27% in Azure growth, which seems to imply that the bottom for that segment may be very near if not already passed. Investors may be worried about how ongoing tech layoffs may impact Office 365 growth, but management appeared unfazed by this risk, citing that they continue to see strong demand for their product suites.
MSFT continues to show why it is a favorite tech stock in growth allocations, as it has shown resilient growth in the face of tough macro. The strong fundamentals have helped the stock sustain a premium valuation multiple, as the stock recently traded hands at just under 35x earnings.
Valuation remains the most obvious risk with that stock trading something between 50% and 100% higher than GOOGL depending on how many adjustments applied to the latter. With the stock trading so richly on present earnings, the stock could go nowhere for 7-10 years and still be trading at around 15x earnings at that time. Unless MSFT manages to sustain double-digit earnings longer than consensus, the stock will likely need to sustain a rich multiple in order to beat the market index. I note that this risk does not appear as large at the aforementioned mega-cap peers due to not just lower valuations but also due to MSFT appearing to already be operationally efficient with operating margins in excess of 40%. Another risk is that of potential disruption to its enterprise tech business. Wall Street appears to view the stock as being the strongest operator in any of its competing markets, but I do not share such views. In particular, I view competition from the likes of CrowdStrike (CRWD),and GOOGL’s productivity suite as being underestimated risks. It is possible that MSFT is about to face long- term disruption just as its growth story is decelerating - which would have a catastrophic impact on multiples. Due to the near term upside from OpenAI, MSFT hit ATH and now its in pullback mode, I took huge profit and waiting for more confirmation
MSFT investment Msft was on a massive pull back after a long run,all this pull back,it's a chance to get into position not a challenge,allow the system to work harder but smart n easily see things from distance,don't depend in short move,investment requires good system displean n waiting for longer for big return.
$MSFT - Math defies logicNational wide, possible global database crash today grounds all flights, cripples hospitals, scares the doot out of people.
Short Microsoft right? Well, let's look at the chart.
Bottom of regression channel after some powerful movement long term. It needed to correct.
Fibs show support, hammered off of the bottom of the current fib channel even under incredible negative real life PR. Can't make this PR up, it's devestating.
Airline stocks down across the board on this news..... MSFT is not?
It got killed pre-hours at 8am, big drop, but recovered on open.
If it holds this FIB level, it moves back up and is a good entry position after a long period of overcooked RSI
My confirmation is when teh stochastics and trend meter show the reversal on the 1 hour chart which is occurring now.
Not trade advice.
MSFT Short TargetI had several bearish charts for MSFT and when I saw it struggle after less than stellar earnings, it looked like a great short so I took it. NQ was up over 3% on the session, but MSFT remained flat. I saw this is as a bearish signal for MSFT and I was liking my position going into close.
To my surprise, MSFT held up incredibly well today considering what happened with NQ. I'm still surprised, but I expect it to break down eventually because it's weak and remains below $430. I think the range from $396-$430 is critical, so if it hits that area I'll look to take some profit.
In addition to the horizontal support, we also have a trendline support that goes back to November of 2023. This should be an area where bulls look to defend, but if not I think it gets worse and fast. Most stocks and indexes I see are right on the edge right now and whichever direction we break from here should end up being the new direction for a few weeks at least.
IS MICROSOFT coming towards the ascending TL?Following the global outage and impact is had on MSFT, I think it will be a driving force that may push MSFT towards the TL on my chart.
lets ee how it plays
Let Wait for Start Some Fresh Long in $NASDAQ:MSFT NASDAQ:MSFT
Go for Fresh Long and Accumulation area..
MSFT Falling Channel PatternNASDAQ:MSFT post earnings now. Below the 100MA and still trading within the falling channel pattern. Will watch to see if we can start trading out of this channel tomorrow if the markets remain bullish like today (currently i'm very cautious for the next 60 days).
Microsoft - We still have to be patient...NASDAQ:MSFT dropped after reporting earnings and can now create a short term correction!
Simplicity is key, also when it comes to trading the higher timeframes on stocks. All you need are three lines in order to fully understand the trading history and also future of Microsoft. If we get a retest of the triangle breakout level, which is perfectly lining up with the rising trendline, a bullish continuation will be quite expected. Just wait for confirmation first though!
Levels to watch: $350
Keep your long term vision,
Philip - BasicTrading
MSFT Bear FlagMSFT does not look good on any time frames really, except for the super long term ones, where it's obviously trending up, uptrends have been broken.
The uptrend from April is broken, the $430 support level is broken. Now it's consolidating and forming a bear flag near last week's lows around $417. My short target is the $400-$396 area. To the upside, it has resistance at $430 and that trendline from April. I'd expect both of those to fail on retests, if it's able to reclaim then it would be time to look for longs IMO.
Microsoft (MSFT) ... Sell the BounceOn July 5th, MSFT completed a Wolfe Wave pattern and fell ~8% within a week to reach our Target 1, an obvious support area.
One should expect a bounce and a 50% retracement to around the $450 area.
This may, subject to broader market conditions, setup another selling opportunity to reach our targets.
Not investment advice... do your own due diligence
Note this is a 1H timeframe !
S
Microsoft Earnings Raise Fears Over AI Spending. Bubble Go Pop?Playing catch-up is big among the highflyers of technology as the Magnificent Seven club races to slurp up AI demand. But is AI spending going to lead to AI bonanza? It’s not that straightforward.
Microsoft (ticker: MSFT ) reported its earnings update for the spring quarter Tuesday after the closing bell. But it failed to appease investors who seem to be waking up to a reality where the billions of dollars jammed into artificial intelligence might not that easily convert into coveted profits.
The AI-optimistic large-cap behemoth has spent piles of cash on advancing its artificial-intelligence capabilities without much to show for it. Markets punished the stock in after-hours trading with shares diving as deep as 8% — a drop that later recovered but still lingered under the flatline.
“Throw Some AI in There, They’ll Love It”
You know how much CEOs love to throw AI in their earnings calls? Microsoft boss Satya Nadella praised the company’s AI efforts in the call with shareholders but even the overuse of AI couldn’t bring the feelgood factor.
Microsoft’s AI-powered cloud business, Azure, grew 29% in the three months to June, falling short of expectations and undershooting the 31% growth in the previous quarter. The company rushed to patch it up and assuage spooked investors, saying the slowdown was due in part to demand for AI running ahead of capacity.
Microsoft: Throws $55.7 billion in capital expenditures.
AI: * giggles, burps * "Thanks for the cash."
For the past three months — the company’s fiscal fourth quarter — Microsoft saw its capital expenditures balloon by almost 80% year-over-year to $19 billion. Moreover, for fiscal 2024, total capital expenditures, or how much the company spent on new stuff, hit $55.7 billion — a figure that is likely to get surpassed next year as Microsoft projects increased spending on AI.
Microsoft’s quarterly results are the latest example, after Google’s (ticker: GOOGL ) flop of an earnings report and Tesla’s (ticker: TSLA ) profit-squeezing quarter , of Big Tech’s lofty aspirations when it comes to AI. And the pushback reaction from investors shows that expectations are so high, it’s near-impossible to beat them.
Big Tech is racing to build out the infrastructure layer that will allow AI to scale so it can start churning out a profit. But the going has recently gotten tough. The Magnificent Seven club of tech mainstays washed out more than $1.5 trillion from its collective market value in the past three weeks.
The question that lingers on investors’ minds right now is how long can markets stay patient before they see revenue growth from AI materialize?
Let Us Know Your Thoughts!
With all the hype around AI, do you see a bubble in the works? Or justified no-froth, no-nonsense valuations? Share your thoughts below!
MSFT Share Price Plummets After Earnings ReportMSFT Share Price Plummets After Earnings Report, But It’s Not All Bad
Yesterday, after the main trading session on the Nasdaq, Microsoft released its second-quarter report:
→ Earnings per share: actual = $2.95, forecast = $2.93;
→ Gross revenue: actual = $64.72 billion, forecast = $64.38 billion.
Despite key figures exceeding analyst expectations, MSFT's share price plummeted, falling below the psychological threshold of $400 in after-hours trading.
Investor disappointment may have been caused by the slowdown in growth of its cloud business and significant financial investments in AI infrastructure—a long-term investment with delayed payback.
Could the decline continue?
Today in pre-market trading, MSFT's price recovered to $411, suggesting that the initial negative reaction to the report may have been overly pessimistic. Additionally, there might have been a cascade of stop-loss liquidations below $400 and the June low around $405, which seemed "secure" when the price was above $460.
Technical analysis of MSFT’s chart shows that price action in 2024 formed an ascending blue channel. If the pre-market price doesn’t change significantly, today’s opening will be just below the channel’s lower boundary. If the RSI considered extended hours data, it might indicate exiting a deeply oversold zone (similar signals in 2024 had profit potential).
If the sharp decline followed by a strong recovery signifies the liquidation of speculators (likely given the approximately 24% rise from the start of the year to mid-July), then MSFT's price could return to the blue channel and resume growth within it (channel boundaries might need adjustment).
Wall Street analysts remain positive. According to TipRanks, the average MSFT forecast is $509.42 within 12 months (above the historical high). All 26 surveyed analysts recommend buying MSFT stock.
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
Microsoft (MSFT) - Edition #1Macro Outlook: 🚀 Bullish 🚀
Bullish momentum is on.
Any retrace from $455 - $448
If we get a price sweep of $445 then most than likely we'll get a bigger retrace to $432 - $410 and we'll still be completely bullish.
MSFT: Just For KicksMSFT hit 395 in after hours during their earnings call, so safe to say that 390 zone is a very strong support. MSFT is now resting on another support (407), so that could be acting as resistance or support tomorrow. If MSFT falls below 404 tomorrow, expect a move to 390. If 404 holds, expect a move back to 430. Either way, there's a gap that was created, and as traders know "all gaps must be filled" (eventually).
$MSFT ending diagonal? Lower prices ahead?I was long calls of NASDAQ:MSFT into this morning and took profits in the first couple hours of trading.
I initially thought we would see a move higher to the upper resistance at $455 or potentially as high as $465, but price couldn't break that $453 level.
After relooking at the chart, it looks like we're forming an ending diagonal. If we break down from here, I could see a large corrective move back down to that $397 or $370 support level (or potentially to the lower support levels). The risk of downside was not worth the potential $2 gain from here.
There's still a chance that we break higher and tag that upper resistance, but there are signs of weakness showing on the chart to me.
We should see what direction we move by the end of the week. Decision time.
MSFT still wave 4 we now seem to be in wave3 of C The chart posted is that of MSFT the BELL WEATHER has now drop in a clear wave 3 of C down into .50% from the peak to the oct low it is also a 15.9 % decline the same decline on a pct basis as we saw from july 2023 to the low of oct 2023 . the last support under all bullish wave count would be 371 this is .382 from peak 465 to 213 low oct . it is also wave a x 1.618 to = wave C at the same point . WAS that the super cycle peak at 465 ?? I have my doubts this is why I took june 2025 calls . I would look for selling at the 200 at 401 but once we close above 422 I would look for targets in the 545 area
MSFT: Heading lower after breaking its trendline.Microsoft sells of following ER and breaks its trendline. Target levels are marked on the chart. Closing July under 400 would be a major warning sign for the remaining of the earning season.
Stocks pairs trading: MSFT vs IBMLet's examine the trade potential for Microsoft (MSFT) and IBM by analyzing their key financial metrics and recent performance to determine reasons for going long on MSFT and short on IBM.
Earnings Growth:
Microsoft: EPS next Y of 13.37%
IBM: EPS next Y of 10.57%
Microsoft’s projected earnings growth outpaces IBM, reflecting stronger expectations for future profitability. This is bolstered by Microsoft’s continuous innovations in cloud computing and software, which have shown resilience and adaptability.
Debt and Liquidity:
Microsoft: Debt/Eq of 0.42
IBM: Debt/Eq of 2.49
Microsoft maintains a significantly lower debt-to-equity ratio compared to IBM, indicating a stronger balance sheet with less reliance on debt. This financial stability makes Microsoft a safer investment, especially in volatile markets.
Profitability Metrics:
Microsoft: ROA of 19.94%, ROE of 38.49%
IBM: ROA of 6.32%, ROE of 36.36%
Microsoft demonstrates superior profitability metrics, showcasing efficient asset and equity utilization to generate profits. This positions Microsoft as a more efficient and potentially more profitable investment.
Recent News Highlights:
Microsoft has been a leader in the SIEM market, with significant advancements in cloud-native solutions like Azure Sentinel, reinforcing its position in the cybersecurity space. Recent updates include fixing critical vulnerabilities and enhancing its Microsoft Defender for Cloud platform, reflecting its proactive stance on security.
On the other hand, IBM reported solid second-quarter results with an emphasis on software-led growth. However, concerns remain over its high debt levels and the potential impacts of macroeconomic conditions on its extensive hardware and services business. IBM has also been expanding its partnerships, such as with ASMPT for advanced chip packaging and Fermilab for quantum computing initiatives.
Decision:
Long on 1 Microsoft (MSFT)
Short on 2 IBM (IBM)
The rationale for this strategy is driven by Microsoft's stronger growth prospects, better financial health, and continued innovation compared to IBM's more moderate outlook and higher financial leverage.
MICROSOFT TOP DOWN ANALYSIS STRATEGYNASDAQ:MSFT showing signs of weakness. We might see further downside in coming weeks if that counter trend line is broken, the next area we be that key support level of $345
Microsoft Corp. Uptrend Line Rejection At $418.20. 30.07.2024- Microsoft Corporation (NASDAQ: MSFT) faces an uptrend line rejection at $418.20.
- If this rejection holds, the price could rise to $448.47, with a potential further increase to $486.89 if $448.47 is breached.
- If the rejection fails, the price may decline to $394.50, with a possible drop to $375.84 if $394.50 is broken.
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Microsoft: Strangling our way throughGoing to purchase Microsoft strangles, expiry period around 4 months. 20 % +- stikes.
The idea here is that we are in for a period of volatility either way - AI is going to have to start yielding fruit soon or the investments are going to be absolutely gigantic. Given the fact that BoJ is ending its free money policy, this is getting harder to justify.
