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According
to Bloomberg, financial analysts expect
Microsoft to increase its capitalization above $ 1 trillion in the near term. The company is preparing to publish a report, the results of which may contribute to the continued growth of the value of shares - it began in December after a record drop of 33%. If the data in the report are as expected, then Microsoft's capitalization should exceed $ 1 trillion.
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Azure as the main growth driver
One of the main drivers of growth in Microsoft shares is its division Azure - cloud services show good results.
Analysts expect this trend to continue in the third quarter of the year. It is the number of Azure sales that cause the greatest interest in the report; it is from it that the growth of stocks will depend.
Presumably, revenue year on year in the case of Azure will exceed 68%. Despite the fact that a year earlier it grew by 93%, the company managed to win back market share from Amazon Web Services, therefore, in general, the results are evaluated positively.
Cloud and Improving Growth Paths
In addition, 29.2% of Microsoft’s revenue in 2018 was accounted for by the Intelligent Cloud division. For comparison, in 2015 this figure was at the level of 25.3%. According to analysts, the cloud business “structurally improved the growth path of Microsoft” - the company received a reliable source of revenue, which gives double-digit growth every year. As a result, Microsoft manages to grow faster than the market as a whole.
Therefore, despite the general slowdown in Microsoft revenue growth, analysts predict a rise in the value of the company's shares.
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