MSFT Rockstar Soaring
Microsoft (MSFT), one of our long-time Rockstars, continues to soar to new heights. The stock touched record highs this morning before pulling back slightly on the heels of another strong earnings report, multiple upward price target and 2020 EPS revisions from analysts, and maybe most importantly, being awarded the highly contested JEDI contract from the Pentagon .
MSFT price. Source: TradingView.
Microsoft’s cloud platform, Azure, has been steadily gaining traction for some time now. With an estimated 18% market share, it is second to only Amazon’s Amazon Web Service platform, which controls approximately 32% of the market.
Last Friday, MSFT was awarded the Joint Enterprise Defense Infrastructure Cloud (JEDI) project from the Pentagon, focused on modernizing the Pentagon’s technology.
This game changer is a 10-year project with an estimated worth of $10 billion.
Many analysts viewed this as an upset victory of sorts, as Amazon was believed to be the frontrunner, but it will be Microsoft’s Azure serving as the sole provider of this important government project.
Azure currently accounts for about 33% of the company’s overall revenue and that number is expected to continue to rise as the cloud business is expected to grow more than $1 trillion over the next decade, with an additional $100 billion from the US government.
On October 14, Microsoft launched Project xCloud, a cloud based gaming application that will allow users to stream and play Xbox games on their smartphones and tablets.
With cloud platforms and services expanding exponentially, Microsoft is very well-positioned to benefit from organic and external growth opportunities.