Overview
- Bank of America, which reinstated coverage Tuesday, set a Buy rating and a $500 price target that implies about 31% upside based on an AI-and-cloud growth thesis.
- BofA projects 15% to 17% annual revenue growth over the next three years and says heavy data center spending will squeeze margins before easing later in the cycle.
- January results showed Azure up 39% year over year and a $625 billion commercial backlog, even as Microsoft said shifting servers to internal AI work has capped what it can sell to customers.
- Copilot counted 15 million paying seats, and Melius Research labeled a recent Copilot reorganization a red flag for near-term revenue conversion.
- Shares sit more than 20% below last fall’s peak, yet most analysts still rate the stock a Buy with an average target near $592.