RBC Reaffirms Outperform Rating on Microsoft Amid Azure Growth
RBC Capital Markets has reaffirmed its positive stance on Microsoft stock, citing strong growth in Azure's cloud infrastructure business. The firm reiterated an Outperform rating and a price target of $640.00.
Azure guidance indicates 44-45% constant currency growth, outshining the overall revenue increase of 18% over the last twelve months, which reached $332 billion. RBC Capital analysts view Microsoft's new reporting structure as an improvement in visibility into core business drivers.
The updated structure combines commercial and consumer cloud businesses under Microsoft 365 Cloud, allowing for clearer disclosure of Azure revenue. Analysts have revised their earnings upwards for the upcoming period, further solidifying confidence in Microsoft's growth trajectory.
Microsoft is currently undervalued, according to InvestingPro analysis, with the stock trading below its Fair Value.