Bank of America Downgrades Microsoft (MSFT)
Bank of America reported on Thursday that it has downgraded software company, Microsoft Corporation (MSFT).
The firm has lowered its rating on MSFT from a “Buy” to “Neutral,” and has reduced the company’s price target from $35 to $33. This price target suggests a 14% increase from the stock’s current price of $28.36.
An analyst from the firm commented, “our Buy thesis was predicated on an aggressive $40bn share buyback program and the Win 7 product cycle. We were hoping that MSFT would make a bold foray with Win 8 into smartphones and tablets. Conventional product cycle wisdom dictates that the stock should peak before a Win launch (it hit $31.45 in Sept ’12 before Win 8), but we remained optimistic because the limited availability of touch-based devices impaired an objective assessment of Win 8. Now, six months post launch, despite more available touch-based devices, Win 8 lacks momentum, challenging our optimism.”
Microsoft shares were down 15 cents, or -0.53% during premarket trading Thursday. The stock has declined -11% in the past year.
The Bottom Line
Shares of Microsoft Corporation (MSFT) have a 3.22% yield, based on Wednesday’s closing price of $28.56.
Microsoft Corporation (MSFT) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.
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