First it was gold and now it is Microsoft Corp. (NASDAQ: MSFT). Gold took a pounding yesterday when Goldman Sachs Group Inc. (NYSE: GS) said it is time to sell gold. Now it is Microsoft’s turn in the barrel. The software and tech giant just got some serious caution issued against the company ahead of the company releasing its third-quarter earnings report, as Goldman Sachs lowered its already cautious Neutral rating down to Sell.

Goldman Sachs also lowered its price target to $27 from $30. If Goldman Sachs is right, then Microsoft shares are being set up for a 10% fall. In our own poll ahead of earnings season, some 65% of the respondents said that Apple Inc. (NASDAQ: AAPL) would respond better to earnings season than Microsoft, with only 35% of the votes. Maybe that is insight, or maybe that poll is investors hanging on to an opinion without ever changing it. After all, Microsoft shares are up 14% year to date, versus a double-digit loss year to date for the fanboy investors in Apple.

The Goldman Sachs downgrade reflects weakening PC trends, as well as not having any real traction in smartphones and in the new tablet craze. IDC showed PC shipments being down 14% in its most recent data, and Gartner Group recently forecast that PC sales (desktop and notebook) would be in decline through the year 2017.

We would note that the valuation here is only about 10 times earnings in the Goldman Sachs note. So far shares are down just over 3%, at $29.25 against a 52-week trading range of $26.26 to $32.89.

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