Analysts Say Microsoft Stock is Deeply Undervalued Ahead of Q4 Earnings - Microsoft (NASDAQ:MSFT)

Analysts said Microsoft stock appears deeply undervalued ahead of Q4 earnings, despite recent weakness in the shares. At the time of publication on Wednesday, Microsoft was down 2.29% to $388.66, as reported by Benzinga Pro. One view highlighted the potential for constructive fourth-quarter results and a credible forward outlook to change the narrative, while still flagging concerns around rising capital expenditure growth and returns. Oppenheimer pointed to persistent issues, including competitive pressure in AI and a perception that some investors believe management is catching up rather than setting the pace. Bernstein argued downside may be limited, but said a true valuation inflection may take time, requiring evidence that Azure revenue growth justifies investment scale and that Azure gross margins stabilize after earlier pressure from CPU and GPU capacity constraints and elevated memory costs. All three analysts emphasized capital expenditures as the core debate heading into the report, noting Microsoft disclosed $190 billion of calendar-year 2026 capex, up 61% year over year.