Microsoft's Stock Recovers From a June Trough as a Class Action and a Cloud Expansion Test Investor Conviction
Published on 07/21/2026 at 13:52 | Redaktion boerse-global.de
Microsoft’s shares have crawled back from their 52-week low of 307.10 euros, hit on June 25, 2026, to trade at 348.75 euros — a recovery of 13.56 percent. That still leaves the stock more than 27 percent below its all-time high of 478.10 euros set in October 2025, a gap that underscores lingering caution despite the recent uptick. The rally picked up pace on Monday, when the stock closed at 352.55 euros, up 2.37 percent, before giving back some ground in the following sessions. The seesaw movement reflects a market caught between a string of bullish developments — a major hardware deal with Advanced Micro Devices and a wave of analyst upgrades — and a fresh class-action lawsuit that threatens to reopen old wounds from January’s selloff.
All eyes are now trained on July 29, when Microsoft reports its fiscal fourth-quarter results after the closing bell. Analysts on average expect earnings per share of $4.24 and revenue in a range of $86.7 billion to $87.8 billion, according to the two consensus estimates cited by separate houses. Bank of America forecasts Azure growth of 39.5 percent, a hair below the 40 percent constant-currency expansion the cloud unit delivered in the third quarter. The investment bank also sees capital expenditure jumping 74 percent to around $42 billion in the quarter alone, a reflection of Microsoft’s multiyear commitment to AI infrastructure that the company earlier pegged at roughly $190 billion for calendar 2026. The third quarter had already set a high bar: revenue of $82.9 billion, adjusted EPS of $4.27, and Microsoft Cloud turnover of $54.5 billion. Copilot paid subscriptions more than doubled to top 20 million.
On July 20, Microsoft and AMD deepened their partnership with a plan to integrate AMD’s new Helios rack system into Azure data centers. Helios will feature Instinct MI455X accelerators, EPYC Venice processors from the Zen-6 generation, Pensando networking chips, and the ROCm software platform. Deliveries are set to begin in the second half of 2026, initially targeting AI inference workloads. Microsoft also unveiled two new Azure instance families: HDv2, with roughly 500 CPU cores, 4 terabytes of RAM, and 32 terabytes of SSD storage for agent-based AI applications; and HXv2, with 176 Zen-6 cores running above 5 gigahertz for semiconductor design. The diversification away from a single chip supplier is intended to ease supply-chain risks and could eventually lower costs.
Should investors sell immediately? Or is it worth buying Microsoft?
Wall Street remains broadly optimistic. Bank of America reiterates a buy rating with a $500 price target, while Deutsche Bank sees $550 and forecasts annual earnings growth above 15 percent. A separate fair-value analysis pegs Microsoft’s intrinsic worth at $466 per share, implying the stock is about 14 percent undervalued given a roughly 46 percent operating margin and the expanded AI partnership with AMD. The current valuation multiple of 20 times expected earnings sits well below the five-year average of 29, leaving room for re-rating if the earnings report delivers.
Yet legal clouds hover. On July 7, the law firm Bronstein, Gewirtz & Grossman filed a class-action lawsuit in the U.S. District Court for the Western District of Washington, case number 26-cv-02071, alleging securities fraud between May 1, 2025, and January 28, 2026. Investors claim Microsoft misrepresented Copilot adoption rates and Azure growth momentum. The suit was triggered by the stock’s plunge after the fiscal second-quarter 2026 report: the share price dropped from $481.63 to $433.50, a roughly 10 percent slide. Shortly afterward, the Wall Street Journal reported that Copilot had attracted only 15 million premium subscribers, undershooting analyst expectations. Investors have until August 11, 2026, to apply as lead plaintiff.
The earnings call on July 29 will therefore be more than a routine financial update. It must demonstrate that the tens of billions funneled into data centers and chip partnerships are translating into measurable revenue acceleration from Azure and Copilot — or risk leaving the stock trapped between its June trough and its October peak. With the AMD deal expanding the AI infrastructure playbook and the class action alleging that previous disclosures fell short, the stakes have rarely been higher for Microsoft’s quarterly ritual.
Ad
Microsoft Stock: New Analysis - 21 July
Fresh Microsoft information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.
Disclaimer regarding our articles: No investment advice, no buy or sell recommendation. Information on prices, companies, and markets is provided without guarantee; changes are possible at any time. Stock market transactions can lead to substantial losses. Our articles are created and reviewed in whole or in part automatically with the support of AI.
