Stock Traders Buy High Volume of Call Options on Microsoft (NASDAQ:MSFT)

Microsoft Co. (NASDAQ:MSFT) was the recipient of some unusual options trading activity on Tuesday. Traders acquired 355,575 call options on the company. This is an increase of 29% compared to the average daily volume of 274,666 call options.

Analyst Ratings Changes

A number of equities analysts recently issued reports on the company. Mizuho raised their target price on Microsoft from $450.00 to $480.00 and gave the stock an “outperform” rating in a research note on Tuesday, July 16th. BMO Capital Markets upped their price objective on shares of Microsoft from $465.00 to $500.00 and gave the stock an “outperform” rating in a research report on Friday, July 12th. Oppenheimer downgraded Microsoft from an “outperform” rating to a “market perform” rating in a research note on Tuesday, October 8th. Bank of America boosted their price objective on Microsoft from $480.00 to $510.00 and gave the stock a “buy” rating in a research note on Wednesday, July 17th. Finally, UBS Group reduced their price target on shares of Microsoft from $520.00 to $510.00 and set a “buy” rating on the stock in a research report on Wednesday, July 31st. One research analyst has rated the stock with a sell rating, three have assigned a hold rating and twenty-eight have assigned a buy rating to the company. According to data from MarketBeat, Microsoft currently has an average rating of “Moderate Buy” and an average target price of $495.68.

Microsoft Trading Up 2.1 %

Shares of Microsoft stock opened at $427.51 on Wednesday. The company has a current ratio of 1.27, a quick ratio of 1.27 and a debt-to-equity ratio of 0.16. The company has a market cap of $3.18 trillion, a price-to-earnings ratio of 37.01, a PEG ratio of 2.22 and a beta of 0.90. The company’s fifty day simple moving average is $420.17 and its 200-day simple moving average is $424.56. Microsoft has a 1 year low of $324.39 and a 1 year high of $468.35.

Microsoft (NASDAQ:MSFT) last posted its quarterly earnings results on Tuesday, July 30th. The software giant reported $2.95 earnings per share for the quarter, topping analysts’ consensus estimates of $2.90 by $0.05. Microsoft had a net margin of 35.96% and a return on equity of 35.95%. The firm had revenue of $64.73 billion for the quarter, compared to the consensus estimate of $64.38 billion. During the same quarter in the previous year, the company earned $2.69 earnings per share. The business’s revenue was up 15.2% compared to the same quarter last year. As a group, sell-side analysts expect that Microsoft will post 13.02 EPS for the current year.

Microsoft announced that its Board of Directors has authorized a share buyback plan on Monday, September 16th that allows the company to repurchase $60.00 billion in shares. This repurchase authorization allows the software giant to purchase up to 1.9% of its stock through open market purchases. Stock repurchase plans are usually an indication that the company’s board believes its stock is undervalued.

Microsoft Increases Dividend

The company also recently declared a quarterly dividend, which will be paid on Thursday, December 12th. Investors of record on Thursday, November 21st will be issued a dividend of $0.83 per share. This is an increase from Microsoft’s previous quarterly dividend of $0.75. This represents a $3.32 annualized dividend and a yield of 0.78%. The ex-dividend date of this dividend is Thursday, November 21st. Microsoft’s dividend payout ratio (DPR) is currently 28.74%.

Insider Activity at Microsoft

In other Microsoft news, CEO Satya Nadella sold 14,398 shares of the company’s stock in a transaction that occurred on Friday, August 23rd. The stock was sold at an average price of $417.41, for a total transaction of $6,009,869.18. Following the sale, the chief executive officer now directly owns 786,933 shares in the company, valued at $328,473,703.53. This represents a 0.00 % decrease in their ownership of the stock. The sale was disclosed in a document filed with the SEC, which is available at this link. In related news, insider Bradford L. Smith sold 40,000 shares of the business’s stock in a transaction that occurred on Monday, September 9th. The shares were sold at an average price of $402.59, for a total value of $16,103,600.00. Following the completion of the transaction, the insider now owns 544,847 shares of the company’s stock, valued at $219,349,953.73. The trade was a 0.00 % decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is available at the SEC website. Also, CEO Satya Nadella sold 14,398 shares of the firm’s stock in a transaction dated Friday, August 23rd. The shares were sold at an average price of $417.41, for a total value of $6,009,869.18. Following the sale, the chief executive officer now directly owns 786,933 shares in the company, valued at approximately $328,473,703.53. The trade was a 0.00 % decrease in their position. The disclosure for this sale can be found here. Over the last ninety days, insiders sold 190,629 shares of company stock valued at $77,916,485. 0.03% of the stock is owned by corporate insiders.

Institutional Inflows and Outflows

A number of institutional investors have recently made changes to their positions in MSFT. Great Lakes Retirement Inc. increased its position in Microsoft by 3.8% in the third quarter. Great Lakes Retirement Inc. now owns 41,184 shares of the software giant’s stock worth $17,722,000 after purchasing an additional 1,519 shares during the period. Tanager Wealth Management LLP grew its holdings in Microsoft by 2.2% during the 3rd quarter. Tanager Wealth Management LLP now owns 22,694 shares of the software giant’s stock worth $9,767,000 after acquiring an additional 491 shares during the period. Onyx Financial Advisors LLC grew its holdings in Microsoft by 1.6% during the 3rd quarter. Onyx Financial Advisors LLC now owns 7,142 shares of the software giant’s stock worth $3,073,000 after acquiring an additional 114 shares during the period. Spectrum Asset Management Inc. NB CA raised its position in shares of Microsoft by 1.7% during the 3rd quarter. Spectrum Asset Management Inc. NB CA now owns 12,985 shares of the software giant’s stock valued at $5,587,000 after acquiring an additional 214 shares during the last quarter. Finally, International Assets Investment Management LLC lifted its stake in shares of Microsoft by 48,526.1% in the 3rd quarter. International Assets Investment Management LLC now owns 38,501,645 shares of the software giant’s stock valued at $16,567,258,000 after purchasing an additional 38,422,466 shares during the period. 71.13% of the stock is owned by institutional investors.

Microsoft Company Profile

Microsoft Corporation develops and supports software, services, devices and solutions worldwide. The Productivity and Business Processes segment offers office, exchange, SharePoint, Microsoft Teams, office 365 Security and Compliance, Microsoft viva, and Microsoft 365 copilot; and office consumer services, such as Microsoft 365 consumer subscriptions, Office licensed on-premises, and other office services.