Microsoft Share Price Forecast November 2021 – Time to Buy MSFT?
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Shares of American multinational technology corporation Microsoft (NASDAQ: MSFT) are in the green today, after closing at $336.63 as of November 29th (22:48 EST). Microsoft has been in the news since CEO Satya Nadella sold over half of his shares in the company. To recap, Nadella sold 838,584 shares between $334.37 and $349.22, totalling $285 million on Nov. 22 and 23. This reduced the CEO’s total holdings to 830791 shares.
Microsoft – Technical Analysis
According to the financial statement of Microsoft, the market cap of the company is at $2.527 trillion with total assets worth $335.418 billion. Revenue for 2020 was at $168.09 billion with a profit margin of 36.45%.
Moving averages such as Exponential Moving Average (20)(332.91), Simple Moving Average (20) (336.14), Exponential Moving Average (30)(328.22), Simple Moving Average (30) (328.76) and Exponential Moving Average (50)(320.01) are indicating a buy action. Oscillators such as Relative Strength Index (14)(58.75), Stochastic %K (14, 3, 3)(29.06), Commodity Channel Index (20)(11.90), Average Directional Index (14)(46.22) and Awesome Oscillator(12.62) are neutral.
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Recent Developments
As of this writing, Microsoft holds the title of the largest public company in the world, slightly edging out Apple, its longtime rival in the consumer products space. Its most recognizable product, the Windows 10 operating system is active on over 1.3 billion devices. Microsoft also owns the Xbox gaming platform and the Surface line of tablets and notebooks. Both of these are billion-dollar consumer brands in themselves. It also owns LinkedIn, a platform that recorded user engagement and delivered 42% revenue growth in the fiscal first quarter.
Microsoft is really starting to perform well in the cloud computing space with Microsoft Azure. Its currently the second largest in the industry behind Amazon Web Services, hosting over 40 different solutions. This includes an innovative artificial intelligence product that can be used for speech and image recognition. Revenue from Azure has consistently outperformed Microsoft’s total revenue in terms of growth, delivering 48% growth in the first quarter.
Perhaps the biggest news coming out of the company at the time of writing is the sale of shares by CEO Nadella. When Nadella took over as CEO in 2014, the company was going through tough waters, with its Windows users stubbornly sticking with older versions of the OS, and it lost the mobile market to Apple. Under Nadella, Microsoft expanded its cloud services, reinvented Windows as a cloud-based service and launched new mobile apps for iOS and Android. With its cloud business powering its core growth, Microsoft’s revenue increased to $168 billion in fiscal 2021 from just $58.8 billion in fiscal 2014.
Should You Buy MSFT Shares?
Investors should know that Nadella’s big sale doesn’t indicate that its long-term prospects have shifted. Therefore, existing investors should not sell their shares just because Nadella sold half of his current position. Interested investors should instead look at other areas such as Microsoft’s cloud growth and the expansion of its ecosystem instead.
With spending on cloud computing globally is expected to grow at an annual rate of 18% through 2026, Microsoft is well-positioned to capture an increased market share which will help its share price. When one invests in Microsoft, one is essentially buying into a highly profitable business with a suite of brands that are very difficult for new competitors to disrupt. This makes Microsoft a bankable stock to beat the market next year and in the long term. To draw a comparison, Microsoft’s price surged by 465% over the last five years compared to the S&P 500’s 114% increase.
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