Bank of America Raises Microsoft Stock Price Target for 2026
Bank of America analyst Tal Liani has raised his price target for Microsoft (MSFT) to $600 from $500, maintaining a 'Buy' rating. This increase reflects stronger-than-expected performance in Azure and the growing adoption of Microsoft 365 Copilot, which now exceeds 30 million paid seats. The new valuation is based on an upward revision of BofA’s earnings multiple for calendar year 2027 to 28 times from 24 times previously. The bank sees Azure as a key growth driver with projected revenue increases and strong execution, supported by Microsoft's expanding AI infrastructure including the upcoming Maia 300 chip. Despite concerns over capital spending and free cash flow declines due to heavy investment in cloud capabilities, BofA believes these investments will yield durable returns that justify higher valuations. Microsoft’s fiscal year 2026 results showed $90 billion in quarterly sales with Azure growing by 43%. The company is also expanding its AI footprint while maintaining partnerships like those with Nvidia. These developments have led to a more optimistic outlook from BofA, which now sees significant upside potential for Microsoft stock.
Topics: AI chips Azure growth Bank of America Microsoft Stock price target