Goldman Sachs initiated coverage on Microsoft (MSFT) with a 'Buy' rating. The investment bank set a price target of $655, suggesting a potential 37% upside.
GS believes Microsoft is best positioned within its coverage universe to capitalize on compounding AI product cycles. The firm highlighted three key advantages: leadership in AI compute, robust copilot and agent orchestration capabilities, and strong vertical integration.
The firm also identified areas of "discovery value" related to artificial intelligence. GS noted that the market's perception is more bearish than its assessment of Microsoft’s competitive standing.
This positive outlook aligns with the broader analyst consensus of a "Strong Buy." GS projects that Microsoft could achieve an EPS of over $35 by fiscal year 2030 under its upside scenario.