Bank of America raised its price target on Microsoft to $600 from $500, pointing to accelerating Azure cloud growth as validation of the company's AI strategy. The call comes as Microsoft shares trade up less than 3% this year, a gain the bank says undersells the stock. Microsoft trades on the Nasdaq, and analyst Tal Liani says it remains one of the bank's favored buy-the-dip names.
Azure growth drives the upgrade
Bank of America analyst Tal Liani told clients to buy the dip in Microsoft, arguing the stock remains undervalued. He pointed to Azure growth accelerating from 39% in 3Q26 to 43% in 4Q26, with guidance calling for 45% growth in 1Q27. According to analyst Tal Liani: "Microsoft's 4Q26 results provided further validation of its AI strategy".
Price target lifted to $600
The bank raised its price target on the stock to $600 per share from $500. Liani said the company's diversified model portfolio improves its AI economics and leaves it best positioned among peers. Yet shares are up less than 3% this year, a gap Bank of America says does not reflect the underlying AI momentum.
Part of a broader buy list
Microsoft was one of several names Bank of America screened as offering compelling opportunities at current prices, alongside UBS, Expeditors International, Timken and First Horizon.
Source: CNBC
Trading involves risk.
Risk Disclaimer
