Microsoft (MSFT) has been unstoppable.
After bottoming out around $280, the tech stock just gapped to $325.70.
All thanks to its latest batch of earnings.
Revenues were up 22% to $45.3 billion. Operating income jumped 27% to $20.2 billion. Net income came in at $20.5 billion GAAP, and $17.2 billion non-GAAP. Both were up 48% and 24%, respectively. Diluted EPS was $2.71 GAAP, and $2.27 non-GAAP, up 49% and 25%.
However, if you’re looking to buy it now, wait for it to pullback first.
After an explosive run, the stock has become technically overbought on RSI, MACD, and Williams’ %R—and is overdue for a healthy near-term correction.
While that call goes against the grain, I’m just telling you what the charts tell us.
Wedbush analyst Dan Ives says it could hit $400. “I think this is just more fuel in the engine to drive this stock higher,” Wedbush analyst Dan Ives told Yahoo Finance. “It just shows [Microsoft CEO Satya Nadella] in this cloud arms race is continuing to gain share.”
JP Morgan raised its price target to $320 from $310. Stifel raised to $380 from $325. Evecore ISI raised to $370 from $325. Morgan Stanley raised to $364 from $331. Credit Suisse raised to $340 from $320, as well.
Again, while I believe MSFT can climb higher, long-term, it’s overdue for a healthy pullback.