How much will the shares rise in price? Analysts at Bank of America named Microsoft as the best investment for 2020 in the software sector. On New Years Eve, they raised their company valuation – high-tech giant securities may rise in price by 27%
Microsoft received a nice gift from Bank of America. The bank's experts included the company in the list of the best investments for 2020, increasing the annual target for shares from $ 162 to $ 200. This is the highest rating by Wall Street analysts to date. It implies the growth of securities by 27% of the current price.
Despite the fact that Microsoft shares have already risen in price by 56% since the beginning of the year, they still retain upside potential. According to analysts, the tech giant has several business segments that will provide strong financial growth in the coming years. Microsoft's revenue will grow by more than 10% annually, BofA calculated.
According to experts, the most promising direction of the company's business is cloud computing.
Azure cloud computing will drive Microsoft over 40% of its annual revenue growth over the next few years. "Azure has not yet reached its limit and will therefore be an important growth driver for Microsoft in the long term," BofA said in an investment note. According to experts, the cloud business will soon be more profitable than its oldest areas – Windows operating systems and server software.
Microsoft has two other business segments that BofA experts rely on. It is a game consoles and social network for finding business contacts LinkedIn. Both directions will make a significant contribution to the company's growth in the coming years, we are confident in BofA.