Microsoft: Goldman Pounds The Table; Sets $29 Target

Goldman Sachs software analyst Sarah Friar this morning added Buy-rated  Microsoft (MSFT) to the firm’s Conviction List, setting a $29 price target on the share. In a research note, she writes that “the combination of better revenue drivers, improved expense management and sizable cash balances provides more opportunities for bottom-line beats.” Friar adds that the combination of Windows 7, Windows Service 2008 R2, Xbox 360 and new Halo content, Bing, Office 2010 and the Azure Cloud software “provide renewed innovation beyond anything we have seen in multiple years.” She adds that the stock is under-owned by growth managers, “providing further buying power.” She cautions that she is not overly optimistic about the June quarter, given IT spending declines, but that investors are now looking out to a lift in growth rates in 2010. She brings her estimates down to $1.72 from $1.75 for the June 2009 fiscal year, to $1.85 from $1.95 for FY 2010, and to ... (link)