D.A. Davidson analyst Gil Luria has upgraded Microsoft shares to buy from neutral, positioning the tech giant as an attractive investment, particularly in the face of a potential consumer slowdown. Luria also increased the price target for the stock by $25 to $450, suggesting a potential upside of 17.4% from Wednesday’s closing price.
Microsoft stands out among the “Magnificent Six” – a group of tech behemoths including Nvidia, Alphabet, Meta Platforms, Apple, and Amazon – due to its lower consumer exposure, second only to Nvidia, according to Luria. The Magnificent Six are a set of major tech companies including Microsoft, Nvidia, Alphabet, Meta Platforms, Apple and Amazon.
“We see Microsoft as the best positioned Mag6 for a consumer slowdown, which will make it a key shelter in the storm,” Luria wrote in a client note released on Thursday. Consumer confidence has recently waned, spurred by concerns surrounding global trade policies and persistent inflation.
The Conference Board’s consumer confidence index experienced its most significant decline since 2021 in February. “While the extent of the consumer slowdown may still be unclear, we believe some slowdown is more likely than not. This would mean less risk for Microsoft’s earnings estimates than the rest of the mega caps, making it the most likely of the Mag6 to become defensive,” Luria added.
Microsoft shares have seen a modest dip of about 3.5% in March and are down more than 9% in 2025. However, Luria views the stock’s valuation as “significantly more attractive” given these recent trends.
Microsoft currently trades at nearly 31 times trailing earnings, while Apple and Amazon have multiples exceeding 34. Nvidia boasts a multiple of 39. Meta Platforms and Alphabet are slightly more affordable on a price-to-earnings basis.
“We believe Microsoft has now rationalized its approach to capex, thus protecting future margins and [return on invested capital],” the analyst explained.
The majority of analysts share a bullish outlook on Microsoft. According to LSEG data, 52 out of 57 analysts covering the stock rate it as a buy or strong buy. The average price target further suggests an upside potential of 31%.
