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Microsoft Just Overtook NVIDIA. Our Model Sees $650+

24/7 Wall St. · 18h ago

Microsoft (NASDAQ:MSFT) now has a market value of roughly $4.05 trillion, which puts it just ahead of NVIDIA (NASDAQ:NVDA) at about $4.04 trillion. The 24/7 Wall St. price target for Microsoft is $670.06. From today’s $543.73, that works out to 23.2% upside.

24/7 Wall St. Price Target Summary Metric Value Current Price $543.73 Price Target from 24/7 Wall St. $670.06 Upside/Downside 23.2% Recommendation BUY Confidence Level 90%

The market-cap lead is narrow enough to change hands within a single session. What drives the stock is more durable. Azure growth is speeding up, the contract backlog is huge, and analyst sentiment is close to unanimous. Microsoft earns a buy rating with high confidence from the model.

An infographic titled '24/7 Wall St. Price Target: Microsoft Just Overtook NVIDIA. Our Model Sees $650+'. The main section, 'THE CALL: OUR 12-MONTH PRICE TARGET,' shows an arrow from $543.73 to $670.06 with a green 'BUY' button and 'High Confidence (90%)'. The 'HOW WE GOT THERE' section lists Trailing P/E-Based Price ($547.25, 20%), Forward P/E-Based Price ($566.96, 50%), and Analyst Consensus ($634.14, 30%), leading to a Weighted Base Price of $583.17, with a note about Mega-cap Dampening (50% reduction). 'OUR ADJUSTMENTS: THE 247FACTOR' indicates an Adjustment Factor of 1.149, driven by Technology Sector Momentum (+15%), Bullish Analyst Sentiment (91%), Strong Earnings Growth (+32.3% YoY), and Mega-cap Dampening (50% reduction). The 'BULL CASE: WHAT COULD GO RIGHT' section shows a target of $775 'If Growth Accelerates,' listing Azure Growth Accelerating (48%), Huge Contract Backlog ($677B, +73%), and High Analyst Sentiment (52 Buy Ratings). The 'BEAR CASE: WHAT COULD GO WRONG' section shows a target of $563 'If Risks Materialize,' listing Massive Capex (+102.99% YoY), Commercial Bookings Decline (-12%), and Weak PC/Windows OEM Demand (-22%). The final section, 'THE BOTTOM LINE,' reiterates 'BUY $670.06 (+23.2%)' and states, 'Azure growth is speeding up, the contract backlog is huge, and analyst sentiment is close to unanimous.'24/7 Wall St. Azure’s 48% Surge Extends a Six-Quarter Beat Streak

Shares rose 7.22% over the past week and 1.62% over the past month. They are up 13.14% year to date. The stock sits 2.8% below its 52-week high of $559.15 and 56% above its low of $348.54.

Fiscal Q1 2027 extended a six-quarter run of EPS beats. Revenue came in at $92.279 billion, ahead of the $90.751 billion estimate, and non-GAAP EPS of $4.89 topped the $4.72 consensus. Azure grew 48%, and commercial remaining performance obligations reached $677 billion, up 73%.

Why Bulls See $775 in Reach

Our bull case lands at $774.71. For next quarter, management guided Azure growth to 49% to 50% in constant currency. On the call, CFO Amy Hood said, “Customer demand continues to exceed available supply.”

Foundry revenue more than tripled, and daily Copilot users rose nearly 50% quarter over quarter. Analysts are in step: 12 Strong Buy, 40 Buy, 5 Hold and zero Sell ratings, with a consensus target of $636.12.

Capex and PCs Are the Pressure Points

Our bear case is $563.15. Quarterly capex jumped 102.99%, and calendar-year spending is expected to reach about $170 billion (much of that goes to the infrastructure suppliers we profiled in a free AI infrastructure report here).

Commercial bookings fell 12%, and management guided Windows OEM revenue down in the mid-30s. There are offsets. The bookings decline shows large Azure commitments in the prior year. Operating cash flow rose 29% to $58 billion, and Microsoft expects to stay free cash flow positive in fiscal 2027.

How Microsoft Compares to Alphabet and Amazon

Alphabet (NASDAQ:GOOGL) earns its place because Google Cloud competes directly with Azure for AI workloads. Google Cloud grew 103%, but Alphabet’s free cash flow fell to negative $9.065 billion. Its low P/E is inflated by a $99 billion equity gain, so it understates how the market prices Alphabet’s core business.

Amazon (NASDAQ:AMZN) runs AWS, the largest rival cloud. AWS grew 39%, but Amazon trades at a higher P/E and runs a far thinner operating margin than Microsoft.

Company P/E Cloud Growth Operating Margin Microsoft 30 48% 46.78% Alphabet 13 103% 32.03% Amazon 37 39% 11.16%

Microsoft has the highest margin of the three and trades below Amazon’s multiple. Against that peer set, our target looks reasonable.

Microsoft Earns Its BUY Rating

The 24/7 Wall St. price target of $670.06 has a buy rating at 90% confidence. The deciding factor is Azure growth that keeps speeding up while margins hold.

The case gets stronger if Azure hits its guidance and delayed GPU capacity arrives in the second half. It gets weaker if capex starts outpacing revenue.

Over the longer term, here is where our model projects Microsoft could trade if current trends hold.

Year Price Target from 24/7 Wall St. 2026 $563.73 2027 $669.82 2028 $782.76 2029 $878.02 2030 $931.13

These estimates assume Microsoft stays on its current path. Faster Copilot adoption could push results higher, while AI spending that fails to earn its keep could pull them lower.