Will Microsoft’s Q1 Earnings Boost Its Valuation?

By Chris Lange Updated Jan 12, 12:27AM EST · Published Apr 26, 8:40AM EDT

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Microsoft Corp. (NASDAQ: MSFT) is expected to report its most recent quarterly results late on Thursday. The consensus estimates from Thomson Reuters calls for $0.85 in earnings per share and revenue of $25.77 billion. In the same period of last year, the tech giant said it had earnings of $0.70 per share and $23.56 billion in revenue.

Currently, Apple is the most valuable company in America based on market cap and is unlikely to let go of that position in the foreseeable future. However, the race for second place has tightened as Microsoft has caught up with Amazon.

Apple’s market cap is currently $830 billion. Microsoft and Amazon are within a percentage point or so of one another at around $710 billion. A critical difference between the two racing for the spot is that Microsoft’s stock has retreated only marginally in the past five days, while Amazon’s has dropped almost 6%.

Microsoft continues to be a powerhouse in enterprise software, PC software and hardware that includes both tablets and its Xbox game system. While Amazon struggles in its core business, Microsoft makes money on all its major products and services.

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Microsoft has outperformed the broad markets with the stock is up 36% in the past 52 weeks. In just 2018 alone, the stock is up 8%.

A few analysts weighed in on Microsoft ahead of the earnings report:

Credit Suisse has a Buy rating with a $115 price target.
RBC has a Buy rating with a $105 price target.
Goldman Sachs has a Buy rating and a $103 price target.
Morgan Stanley has an Overweight rating with a $130 target.
William Blair has a Buy rating.
Deutsche Bank has a Buy rating with a $130 target price.

Shares of Microsoft closed Wednesday at $92.31, with a consensus analyst price target of $105.74 and a 52-week range of $67.14 to $97.24. The stock was up 1.6% at $93.72 in early trading indications Thursday.

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About the Author Chris Lange →

Chris Lange is a writer for 24/7 Wall St., based in Houston. He has covered financial markets over the past decade with an emphasis on healthcare, tech, and IPOs. During this time, he has published thousands of articles with insightful analysis across these complex fields. Currently, Lange's focus is on military and geopolitical topics.

Lange's work has been quoted or mentioned in Forbes, The New York Times, Business Insider, USA Today, MSN, Yahoo, The Verge, Vice, The Intelligencer, Quartz, Nasdaq, The Motley Fool, Fox Business, International Business Times, The Street, Seeking Alpha, Barron’s, Benzinga, and many other major publications.

A graduate of Southwestern University in Georgetown, Texas, Lange majored in business with a particular focus on investments. He has previous experience in the banking industry and startups.