Microsoft Corp (NASDAQ:MSFT) shares are trading lower Wednesday following a downgrade from UBS.
What Happened: UBS analyst Karl Keirstead downgraded Microsoft from Buy to Neutral and lowered the price target from $300 to $250, citing a softening outlook for Microsoft Azure and Office.
Following a series of checks, Keirstead believes Microsoft Azure is entering a deceleration phase. The UBS analyst is concerned the growth slowdown may be organic rather than tied to headwinds from the macro landscape. Office 365 is also susceptible to a slowdown, the analyst added.
Kierstead also highlighted Microsoft’s valuation, noting shares are trading with a “defensive premium.” The stock is currently trading with a forward earnings multiple of approximately 25, according to Benzinga Pro.
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MSFT Price Action: Microsoft has a 52-week high of $326.07 and a 52-week low of $213.43.
The stock was down 4.24% at $229.42 at time of publication, according to Benzinga Pro.
Photo: courtesy of Microsoft.
