Evercore ISI reiterated an Outperform rating and $625 price target on Microsoft (NASDAQ:MSFT), saying recent share weakness should be viewed in context of strong long-term fundamentals.
The analysts noted that since reporting strong fourth-quarter results, Microsoft shares had fallen about 7%, compared to a 2% rise in the S&P 500. However, the stock was still up 19% year-to-date.
They said Azure’s 39% year-over-year growth in Q4 remained supported by ChatGPT inferencing and steady enterprise demand, though first-quarter enterprise bookings could present challenges.
Evercore said Microsoft was well-positioned to monetize AI at both the infrastructure and agentic layers over the next three to five years. They added that with the company guiding to flat operating margins for fiscal 2026, there was potential for estimates to move higher.
