Bernstein SocGen lifts Microsoft target to $540: AI cloud growth fuels optimism

Bernstein SocGen has increased its price target for Microsoft to $540 from $520, maintaining an Outperform rating on the stock amid growing optimism fueled by AI cloud growth.

The firm attributes this bullish outlook to Microsoft’s strategic partnership with OpenAI, which is expected to drive significant demand for Azure’s cloud infrastructure. "If OpenAI’s roadmap unfolds as projected, Azure stands to capture a sizable share of the resulting demand," the analysts noted.

Reflecting this potential, Bernstein SocGen has raised its revenue forecast for fiscal year 2027 and increased earnings estimates for both FY26 and FY27. Additionally, the valuation multiple for Microsoft was increased from 28.5x to 29.5x, signaling heightened confidence in the company’s growth trajectory.

This adjustment underscores the growing importance of AI technologies in cloud computing and Microsoft’s positioning as a key beneficiary. The partnership with OpenAI is seen as a catalyst for sustained revenue growth and profitability, reinforcing Microsoft’s leadership in the cloud sector.

Overall, Bernstein SocGen’s revised target and forecasts reflect a strong belief in Microsoft’s ability to capitalize on AI-driven cloud demand, making it a compelling investment opportunity in the technology space.

Bernstein SocGen raised Microsoft’s price target to $540 from $520, citing strong AI-driven cloud growth. The firm highlighted Microsoft’s partnership with OpenAI as a key driver, boosting revenue and earnings forecasts for FY26 and FY27, and increasing the valuation multiple to 29.5x.