Microsoft Corporation (NASDAQ: MSFT) shares rose in early trading yesterday lower trade volume than normal after a number of analysts weighed in on the investing value of the stock with a downgraded rating.
Meanwhile, in early trading today the Dow Jones Industrial Average DJIA, +0.19% rose 40 points, or 0.2%, to 19,929 while the S&P 500 SPX, +0.31% added 5 points to 2,275, a rise of 0.2%. The Nasdaq Composite Index COMP, +0.53% climbed 19 points, or 0.3%, to 5,567.
Analysts at Zacks Investment Research downgraded shares of Microsoft Corporation (NASDAQ: MSFT) from Buy to Hold in a research note to investors today. With a rating of Hold on the stock, the company has a 52-week high of $64.10. The one-year price target of $66.33 is above the opening price of $62.62, resulting a number of other analysts to comment on the stock recently. Material and fundamental changes in the company’s actions, future direction or industry can cause downgrades as the analysts consider that the future prospects for the security have diminished from the initial recommendation.
Yesterday Microsoft Corporation (NASDAQ: MSFT) shares last traded at $62.66, which is a spike of $0.05 compared to the previous closing price. Opening at $62.62, they fluctuated from $62.35 and $62.87 throughout the day.
Microsoft Corporation (NASDAQ: MSFT) now has a market cap of 487.16B.
Microsoft Corporation (NASDAQ: MSFT) Average Daily Trading Volume
2,541,692 shares crossed the trading desk yesterday, 20 percent lower than normal, out of a total float 7,588,275,000. lower than normal. Look for trading volume to pick up in the coming days as swing traders often use swings in trading volume to identify heavy volume accumulation or distribution by institutional investors.
As with all potential breakouts, investors look for volume to be at least 40%-50% higher than normal on the breakout to show that fund managers and other professional investors are jumping in.
Institutional sponsorship is defined by ownership of a stock by mutual funds, banks, pension funds and other large institutions.
These professional investors have teams of analysts researching thousands of stocks. Thus, watching their interests is a good way to ensure you are buying the right stocks.
Microsoft Corporation (NASDAQ: MSFT) Moving Averages
A moving average can also act as support or resistance. In an uptrend a 50-day, 100-day or 200-day moving average may act as a support level, as shown in the figure below.
This is because the average acts like a floor (support), so the price bounces up off of it.
In a downtrend a moving average may act as resistance; like a ceiling, the price hits it and then starts to drop again.
By tracking the activity of these professional investors—and the moving averages they affect—it allows for traders to make more effective decisions on trades.
Trades for Microsoft Corporation (NASDAQ: MSFT) have ranged from $48.03 – 64.100, and the stock now has a 50-day MA of $61.81 and 200-day MA of $57.95. Today’s last price is 2.25%% lower than the 52 week high of $64.10.
Indeed, earnings growth is among the most important things to look at in regards to stock investing and, accordingly, investors look for companies that have increased their earnings at least 25% or more over the past 3 years.
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