MSFT Stock Today, December 24: Wedbush Sets $625 PT on AI Growth
Microsoft stock is in focus today as Wedbush’s Dan Ives reiterated an Outperform rating with a $625 MSFT price target, citing Azure AI growth and strong Copilot adoption that could add about $25 billion to FY26 revenue. Shares of MSFT recently traded near $488.02, within a session range of $484.83 to $489.16, and a market cap of $3.63 trillion. With a 52-week high of $555.45 and low of $344.79, investors are weighing AI monetization, near-term technicals, and valuation into the next earnings update.
Wedbush’s $625 call and the AI setup
Dan Ives reaffirmed Microsoft as Outperform with a $625 target, implying about 28% upside from $488.02. The call highlights rising confidence in AI-driven revenue, versus a Street consensus target near $614.57 and a range of $470 to $700. Shares sit below the 50-day average of $499.21, but well above the 200-day at $475.02, which keeps the longer trend constructive.
Wedbush cites faster Azure and Copilot adoption and says investors still undervalue AI monetization potential into 2026. The note flags roughly $25 billion of FY26 revenue uplift, framing Microsoft as a core AI winner. See coverage in Investor’s Business Daily and Yahoo Finance for additional context on the thesis and market reaction.
Where AI could add dollars
Azure AI growth and Microsoft 365 Copilot seat adds are the key swing factors. Higher attach across enterprise customers, plus workload migration to Azure, expands the cloud base that AI can monetize. If adoption holds, AI services can lift both revenue and lifetime value per customer, while cross-selling across GitHub, Dynamics, and security deepens wallet share.
AI demand supports Intelligent Cloud growth, but it also requires data center spend. Current capex intensity is notable, with capex to revenue at 23.49% and capex to operating cash flow at 46.94%. Even so, Microsoft’s net margin is 35.71% and ROE is 31.53%. If AI usage scales, software mix and premium services can support margins through FY26.
Today’s trading, technicals, and sentiment
Microsoft stock edged up 0.24% to $488.02, with volume at 5.86 million versus a 23.15 million average. The session ranged from $484.83 to $489.16. Price is under the 50-day average of $499.21 and above the 200-day at $475.02. That suggests a neutral-to-positive setup while the stock consolidates gains from the past six months.
RSI at 50.43 is neutral, while the MACD histogram at 1.85 shows improving momentum. ADX at 20.53 signals a weak trend, and MFI at 71.04 is elevated. With price near the Bollinger middle band at 483.83 and under the upper band at 494.47, buyers have an edge, but Williams %R at -19.98 hints at near-term overbought risk.
Valuation, risks, and what to watch
MSFT trades at 34.69 times TTM EPS of 14.07 and 12.35 times sales, with a 0.70% dividend yield. Balance sheet strength stands out, with debt to equity at 0.167 and interest coverage at 54.35. Analyst split: 44 Buys, 2 Holds, 1 Sell. Price targets span $470 to $700, with a $630 median and $614.57 consensus.
Next earnings is scheduled for January 28, 2026. Watch Azure AI growth, Copilot seat metrics, gross margin, and FY26 guidance. Track capex plans tied to AI infrastructure. A composite stock grade of A (score 83.84) suggests positive fundamentals. Competitive AI pricing, workload shifts, and macro IT budgets remain the main watch-outs.
Final Thoughts
Microsoft stock has a supportive backdrop after Wedbush’s $625 target, which leans on Azure AI growth and Copilot adoption that could add about $25 billion to FY26 revenue. The setup shows solid fundamentals, constructive long-term trend, and a credible AI roadmap. Near term, technicals are neutral, with price below the 50-day average but above the 200-day. Valuation is rich versus history, so execution on AI monetization and stable margins will be key. This article is for information only. We do not provide financial advice. The author holds no positions. Please verify live prices and consult a licensed financial advisor before investing.
FAQs
Wedbush’s Dan Ives reiterated an Outperform rating with a $625 Microsoft stock price target. That implies roughly 28% upside from about $488. The call cites stronger Azure and Copilot adoption and argues the market still underestimates Microsoft’s AI monetization potential heading into FY26.
AI updates affect growth assumptions for Azure and Copilot. Wedbush estimates AI could add about $25 billion to FY26 revenue, which lifts confidence in long-term cash flows. When investors see higher attach rates and usage, sentiment improves and supports Microsoft stock at current valuation levels.
MSFT trades at 34.69 times trailing earnings and 12.35 times sales, with a 0.70% dividend yield. That is a premium to many large caps. Bulls point to strong margins and AI growth, while bears note high capex needs and competition. Execution on AI monetization will need to justify the multiple.
Focus on Azure AI growth, Copilot seat counts, gross margin, and any updates on data center capex. The next earnings date is January 28, 2026. Guidance around FY26 revenue and AI contribution will matter most, along with commentary on enterprise budgets and competitive dynamics.
Disclaimer:
The content shared by Meyka AI PTY LTD is solely for research and informational purposes. Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.
