Microsoft: Color on Quarter (68.27)
- BMO raises tgt to $75 from $71. They believe that Azure will help Intelligent Cloud (IC) generate more than 10% growth in FY18. Moreover, they believe Microsoft's advantage in the cloud includes a higher level of services, established sales relationships, and a portfolio of enterprise-ready software, demonstrated by Azure's premium revenue growth in the triple digits and 80% of the Azure customers using premium services. They believe that MSFT's diverse portfolio, including cloud leadership, warrants a premium valuation.
- RBC raises tgt to $77 from $72. MSFT delivered upside to all key metrics and guided implied 4Q17 EPS above consensus. Importantly, adjusted operating income grew Y/Y CC in all three segments for the first time and they think they are just getting started. They think MSFT's center of gravity is getting larger across cloud, collaboration and enterprise apps and the pace of innovation demands respect.
- MSFT unchanged premarket after falling to the 66 level right after the print