Goldman Sachs: Lowered Microsoft's target price to $500, maintaining a "buy" rating

Goldman Sachs has lowered its target price for Microsoft from $515 to $500 while maintaining a "buy" rating on the stock. After Microsoft announced its artificial intelligence capital expenditure forecasts for the 2026 and 2027 fiscal years, Goldman Sachs slightly lowered its free cash flow expectations for the company. However, in a research report, Goldman Sachs stated that with the rollout of capabilities and the continued growth in artificial intelligence revenue, Microsoft's performance should outperform Goldman Sachs' 14% revenue growth expectations. Goldman Sachs added that Microsoft's profit growth still outpaces the S&P 500 index by 300 basis points, demonstrating that the stock's valuation is reasonable