Microsoft Corp.’s stock sidestepped its worst losing streak in more than a year on Monday, as the stock also lost its last Wall Street bear.
Microsoft
MSFT,
shares dipped as much as 0.6% Monday, threatening a seventh session of consecutive declines, which would have been its worst losing streak since Sept. 6, 2022, when shares fell for seven straight trading days, according to Dow Jones Market Data. In the final hour of trading, however, shares rallied to swung into the green heading into the close. and finished up 0.2% at $317.54.
Shares of Microsoft spent most of Monday’s session trading at a loss, even as Guggenheim analyst John DiFucci upgraded the stock to neutral rating, ending his holdout as Wall Street’s only sell rating on the stock.
Out of the 51 analysts who cover Microsoft, DiFucci stood as Wall Street’s sole sell rating on the stock since January, according to FactSet data.
In a Monday note, titled “You Can Be Right…And Dead Wrong,” DiFucci stepped away from his sell rating, saying he stopped holding out as Microsoft’s “Generative AI narrative is too positive a force to contend with, even though the troubling dynamics we thought might develop, did,” adding that Windows has continued to struggle.
As recently as July, DiFucci said that risks to his model included better-than-expected Azure growth for the rest of the year, Windows revenue outperforming industry analysts’ expectations for developed-market PC shipments, and mid-teens growth for the next couple of years.
Di Fucci said that less than three weeks after his downgrade, Microsoft demonstrated OpenAI’s ChatGPT on a webcast, kickstarting the year’s AI frenzy. Microsoft has invested billions of dollars in OpenAI, led by Chief Executive Sam Altman.
Read: Sam Altman thinks we should feel good, but not great, about him as our AI leader
“And like every other person on the planet, we’ve come to expect that the GenAI ‘narrative’ will become more than just a story, though we still question how much monetization will be realized and over what timeframe,” DiFucci said.
Microsoft’s stock closed Monday 11.7% off its record closing high of $359.49, set on July 18, and finished in the neighborhood of where shares traded four months ago, when they closed at $313.85 in late May 24, according to Dow Jones Market Data.
Year to date, Microsoft shares are up 32.4%, while the S&P 500 index
SPX
is up 13% and the tech-heavy Nasdaq Composite
COMP
has gained 26.8%.
Meanwhile, the Dow Jones Industrial Average
DJIA,
of which Microsoft is a component, also swung to a gain Monday and finished up 0.1%. The Dow is up 2.6% year to date.
Here’s how the past seven trading days compared with Microsoft’s seven-session losing streak from Aug. 26-Sept. 6, 2022, which coincided with a Dow slump as well, according to FactSet data:
| Day | MSFT % 2022 | DJIA % 2022 | compare | MSFT % 2023 | DJIA %2023 |
| 1 | -3.9 | -3.0 | -2.5 | -0.8 | |
| 2 | -1.1 | -0.6 | -0.4 | +0.1 | |
| 3 | -0.9 | -1.0 | -0.1 | -0.3 | |
| 4 | -0.6 | -0.9 | -2.4 | -0.2 | |
| 5 | -0.4 | +0.5 | -0.4 | -1.1 | |
| 6 | -1.7 | -1.1 | -0.8 | -0.3 | |
| 7 | -1.1 | -0.6 | +0.2 | +0.1 |
Earlier this month, one analyst said Microsoft had a “rich catalyst path ahead,” and the company also announced a 10% dividend increase.
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