UBS Lowers Microsoft Price Target to $480 Amid High Spending Concerns

UBS cuts MSFT target to $480 citing high capex and flat Azure growth guidance. Risks include OpenAI exposure and open-source competition, though 'Buy' rating is maintained.

Woofun AI reports that UBS has reduced its price target for Microsoft (MSFT) from $510 to $480, while retaining a "Buy" rating. The adjustment reflects concerns over potential increases in capital expenditure coupled with Azure growth guidance that remains steady rather than expanding.

The analyst notes that this combination of high spending and limited revenue growth expectations is viewed unfavorably by the market. Additional risks identified include exposure to OpenAI, competition from open-source models, and scrutiny of the flagship productivity software business. Despite these factors, the recent stock pullback is seen as having partially released fourth-quarter performance risks.