Microsoft (MSFT) Stock Crashes to 10-Year Valuation Low — Analysts See 60% Upside

TLDR

• MSFT is down 23% in 2025 and roughly 31% from its all-time high, trading at $371.71
• Goldman Sachs and Barclays both reaffirmed $600 price targets with Buy ratings on April 6–7
• Wall Street’s street average 12-month price target sits at $582.17, implying ~56% upside
• BofA added MSFT to its US 1 List — its top investment ideas
• The last time MSFT fell 30%+ from a high was late 2022, and it recovered to set new all-time highs in 2023

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Microsoft has had a rough start to 2026. The stock is down over 23% since the end of 2025, sitting at $371.71 as of April 7 — and it’s now about 31% off its all-time high set in late October 2025. For a company of Microsoft’s size, that’s a steep drop.

Microsoft Corporation, MSFT

AI spending concerns have been the main driver of the selloff. Investors have been questioning whether the heavy capital expenditure on AI infrastructure will pay off. But Microsoft’s cloud business — which powers a large portion of the AI workloads being run today — continues to generate strong revenue.

The stock is also trading near its cheapest valuation on a price-to-earnings basis in the last decade, which is catching the attention of analysts.

Wall Street Stands Firm

Goldman Sachs analyst Gabriela Borges reaffirmed her $600 price target and Buy rating on April 6. The following day, Barclays analyst Raimo Lenschow matched that exactly — same price, same rating.

Both targets were originally set earlier in 2026. At the time of Goldman’s first call, MSFT was trading around $433.50, implying a 38% upside. Now, with the stock lower, that same $600 target implies a 61.59% gain.

The broader street consensus isn’t far behind. Based on notes issued over the past three months, the average 12-month price target on MSFT sits at $582.17 — about 56% above current levels. TipRanks data puts Wall Street’s overall rating at Strong Buy.

BofA also added Microsoft to its US 1 List on April 7, a curated collection of the firm’s best investment ideas. Spotify and Viking Holdings were added at the same time.

History Offers Some Context

The last time MSFT fell 30% or more from a recent high was during late 2022 and early 2023, when recession fears peaked. The stock recovered fully over the course of 2023 and went on to set multiple new all-time highs.

That earlier version of Microsoft — the one that crashed with the dot-com bubble in 2000 and didn’t recover until 2016 — is a different business. Today, a large portion of revenue comes from recurring subscriptions and cloud services, which provide more stable cash flow regardless of broader economic conditions.

Microsoft’s subscription model means customers can’t simply opt out during a downturn — they continue paying to maintain access. That recurring revenue base is a key reason analysts remain constructive on the stock.

BofA’s addition to the US 1 List on April 7 is the most recent signal of institutional confidence in MSFT at current levels.

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