Microsoft (MSFT) Stock Higher as Analysts Applaud Halo 5

Microsoft's (MSFT) price target was raised at Piper Jaffray to $64 from $53 by analysts who reiterated their 'overweight' rating on the stock.
By U-Jin Lee ,

NEW YORK (TheStreet) -- Microsoft's  (MSFT) - Get Report price target was raised to $64 from $53 at Piper Jaffray by analysts who reiterated their "overweight" rating on the stock. 

In Tuesday's pre-market trading session, Microsoft shares are gaining 0.07% to $54.20.

The firm cited the company's newly-released video game Halo 5: Guardians, which generated $400 million in its first week of sales.

Responding to these results, analysts said that this game appears to be its "most successful" Halo so far, in comparison to its four previous iterations.

Since the game launched on October 27, users have spent more than 21 million hours playing it. 

Consequently, Microsoft's sales in the December quarter could be helped by a growth in Xbox Live subscriptions, full game digital downloads, expansion packs, and micro-transactions, the firm noted.

Based in Redmond, WA, Microsoft develops, licenses, and supports software products, services, and devices worldwide.

Separately, TheStreet Ratings team rates MICROSOFT CORP as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:

We rate MICROSOFT CORP (MSFT) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its solid stock price performance, increase in net income, reasonable valuation levels, expanding profit margins and good cash flow from operations. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The stock has not only risen over the past year, it has done so at a faster pace than the S&P 500, reflecting the earnings growth and other positive factors similar to those we have cited here. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and the Software industry average. The net income increased by 1.8% when compared to the same quarter one year prior, going from $4,540.00 million to $4,620.00 million.
  • The gross profit margin for MICROSOFT CORP is currently very high, coming in at 71.80%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 22.67% is above that of the industry average.
  • Net operating cash flow has slightly increased to $8,594.00 million or 2.87% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -10.51%.
  • You can view the full analysis from the report here: MSFT
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