Microsoft (MSFT) Stock: President Sells $20 Million After Earnings Dip

TLDR

• Microsoft Vice Chair Brad Smith sold 38,500 shares worth roughly $19.97 million on Nov. 3, following the company’s post-earnings stock slide.
• Smith now directly owns 461,596.76 Microsoft shares valued at over $237 million based on recent closing prices.
• Microsoft stock has dropped 5% since its latest earnings report as investors worry about AI spending levels.
• The company’s capital expenditures reached $34.9 billion in Q1, exceeding expectations as it doubles down on AI infrastructure.
• Microsoft posted strong Q1 earnings with $4.13 EPS beating estimates of $3.65 and revenue of $77.67 billion.

Microsoft Vice Chair and President Brad Smith sold 38,500 shares of company stock on Nov. 3. The transactions totaled approximately $19.97 million.

The sales came as Microsoft stock continues to slide following its latest earnings report. Shares have dropped 5% since last week’s results.

Microsoft Corporation, MSFT

Smith executed two separate transactions that day. The first sale involved 30,411 shares at an average price of $518.49 each.

The second transaction covered 8,089 shares at $519.21 apiece. After these sales, Smith directly owned 461,596.76 shares.

Based on Tuesday’s closing price of $514.33, Smith’s remaining stake is worth more than $237 million. Microsoft did not provide a comment on the sales.

The stock trades down 1.4% following the insider selling activity. The company’s shares remain up 21% for the year overall.

Microsoft posted its fiscal first-quarter earnings at the end of October. The software company reported $4.13 earnings per share for the quarter.

That figure topped analysts’ consensus estimates of $3.65 by $0.48. Revenue came in at $77.67 billion, beating estimates of $75.49 billion.

The company’s revenue for the quarter was up 18.4% on a year-over-year basis. Microsoft had a return on equity of 33.47% and a net margin of 35.71%.

AI Spending Concerns Weigh on Shares

The post-earnings decline stems from concerns about Microsoft’s AI spending. Capital expenditures reached $34.9 billion in the quarter, exceeding expectations.

Microsoft has doubled down on spending related to artificial intelligence infrastructure. The investment comes as the company races to maintain its position in the AI market.

Smith’s sales occurred as markets experienced broader concerns about AI investments. Questions are emerging about whether hyperscalers are spending too much capital.

The Nasdaq Composite dropped 2% on Tuesday, marking its worst day in nearly a month. The decline reflected growing worries about returns on massive data center investments.

On the same day as Smith’s stock sales, Microsoft announced plans for the United Arab Emirates. The company said it would invest $15.2 billion in the region by 2029.

Dividend Increase and Analyst Ratings

Microsoft declared a quarterly dividend increase to $0.91, payable on December 11th. This represents an annualized dividend of $3.64 at a yield of 0.7%.

The new dividend marks an increase from the company’s previous quarterly dividend of $0.83. Stockholders of record on Thursday, November 20th will receive the payment.

Multiple analysts have issued price targets on Microsoft stock recently. Sanford C. Bernstein boosted their price target from $637 to $645.

Wolfe Research set a $675 price objective on shares. Evercore ISI and Cantor Fitzgerald both set price targets around $640.

Based on data from MarketBeat, the company has an average rating of “Buy.” The average target price stands at $634.59.

One research analyst has rated the stock with a Strong Buy rating. Thirty-seven have assigned a Buy rating and one has given a Hold rating.

The company has a market capitalization of $3.77 trillion. Its P/E ratio stands at 36.07 with a P/E/G ratio of 2.36.

Microsoft’s 50-day moving average price is $514.32. The 200-day moving average price sits at $490.44.

The company maintains a quick ratio of 1.35 and a current ratio of 1.35. Its debt-to-equity ratio stands at 0.12.

The post Microsoft (MSFT) Stock: President Sells $20 Million After Earnings Dip appeared first on CoinCentral.