Goldman Sachs Sticks with 'Sell' Rating on Microsoft (MSFT); PT to $40
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Goldman Sachs analyst Heather Bellini bumped her price target on Microsoft (NASDAQ: MSFT) to $40.00 (from $38.00) following results but maintained her Sell rating.
Bellini commented, "For the sixth quarter in a row, MSFT guided out quarter revenue and EPS at the midpoint below the Street. MSFT guided F4Q15 to a revenue $21.6- 22.3bn (-8% to -5% yoy) vs. consensus prior to the print of $22.7bn (-3% yoy). D&C Licensing and Commercial Licensing were once again forecast to be below the Street. And we calculate non-GAAP EPS (ex-R&I) guidance of $0.55-0.58 vs. consensus of $0.62. As expected, we see consensus estimates for F4Q15 and FY16 moving lower post the print."
She added, "We look to the company’s Build Event and Analyst briefing next week to learn more about upcoming Windows releases as well as the company’s outlook on where it is in the model transition as well as its forecast for expenses. We believe consensus revenue and EPS remain aggressive in FY16 & FY17 as the company continues down its transition journey."
The firm bumped FY 2015 EPS from $2.30 to $2.43, FY 2016 EPS from $2.66 to $2.69 and FY 2017 EPS from $3.01 to $3.09.
For an analyst ratings summary and ratings history on Microsoft click here. For more ratings news on Microsoft click here.
Shares of Microsoft closed at $43.34 yesterday.
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