Leading software giant Microsoft stock (NASDAQ: MSFT) opened Friday’s trading session at the $428 level. The equity remains range-bound on the charts this week, with little to no price spurts. The stock has been trading sideways, and TD Cowen’s analyst, Andrew Sherman reiterated his buy rating on MSFT on June 4.
According to the latest price prediction from the analyst, Microsoft stock is expected to surge double-digit and climb above $500. This is among the most bullish price predictions received for MSFT, as the upside trajectory is high. An investment in the software titan could reap profits if TD Cowen’s target becomes a reality.
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TD Cowen Predicts Microsoft Stock To Reach $540
Sherman wrote in a note to clients on Thursday that Microsoft could reach a high of $540 next. That’s an uptick and return on investment of approximately 26%. Therefore, an investment of $1,000 could turn into $1,260 if the price prediction turns out to be accurate. That’s stellar gains, as not every asset in the stock market delivers double-digit returns to investors.
However, the analyst has lowered his price target for Microsoft stock from the previous prediction of $610. That’s a haircut of $70 for MSFT, but still maintains the buy and Outperform rating. This creates a buy-the-dip narrative, and the trim in the projection isn’t a sign of panic. His estimates reflect the macro pressures affecting the markets, including a surge in oil prices and the uncertainty of the US-Iran talks.
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Therefore, the TD Cowen analyst chipped off the previous price target as the conditions to meet $610 are not met. He wrote in the note to clients that the change in Microsoft stock target is a “pragmatic valuation calibration rather than a structural red flag” for MSFT. The $540 range is a safety net for traders representing his buy call for the software giant.