The race to become the world’s first trillion dollar company just got heated up. While everyone speculates on who will hit the mark first, all eyes have been fixed on top tech giants such as Apple, Facebook, Amazon, and Alphabet.
However, multinational tech company, Microsoft, pulled the rug underneath their feet, as its stock price took an upward 7.57 percent leap, to close the day at $93.78.
If you’re an ardent follower of the stock market, you probably know that it wasn’t so solid last week when The Dow dropped to 425 points, which has been attributed to the trade tensions between the U.S. and China.
This has since eased out, erasing all the drops and raising The Dow up 224 points, to settle at 669 points.
However, Microsoft’s gain on the stock exchange isn’t just a result of the stock market, but also because Morgan Stanley – a financial investment services firm – predicted that the Seattle tech giant would reach the $1 trillion market value.
Keith Weiss, an analyst and Managing Director at Morgan Stanley, announced that he would be raising his 12-month price target to $130 – almost 50 percent higher than the $87 shares the stock was trading on Monday, last week.
Weiss’ prediction is that Microsoft’s dominant share of the public cloud market, projected at $250 billion, will grow despite the growing competition from its counterparts, Amazon and Google.
Additionally, Morgan Stanley says that Microsoft’s cloud assets and other existing assets, its huge customer base and distribution channel should, in the next three years, help the company gain market share.
Other ways they highlighted that Microsoft stands out from cloud giants Amazon and Google include Microsoft Analytics, productivity and front office apps, machine learning and core financials.
Microsoft’s growth in the stock market, which was up 44 percent last year, can also be attributed to the change of guard after Satya Nadella, the company’s third CEO, took over from Steve Ballmer in February 2014.
The company’s market cap currently stands at $722 billion, placing it fourth after Apple’s $877 billion, Amazon’s $753 billion, and Alphabet whose market cap is now at $731 billion.
Who will hit the mark first? Only time will tell.
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