Stifel believes that heavy AI spending and rising competition could weigh on Microsoft ‘s growth. The investment firm downgraded the “Magnificent Seven” technology titan to a hold rating from buy. Analyst Brad Reback also lowered his price target to $392 from $540. Shares of Microsoft are flat over the past 12 months but have slipped 14% this year. Reback’s revised forecast implies that the stock has a further 5% to fall. MSFT 1Y mountain MSFT 1Y chart Reback said that his downgrade comes as Wall Street’s earnings and revenue expectations appear too optimistic. “Given the well-documented Azure supply issues, coupled with Google’s strong GCP Gemini results this evening and growing Anthropic momentum, we believe near-term Azur acceleration is unlikely,” he wrote. “Net/net, while MSFT remains well positioned over the long-term to navigate the rapidly [evolving] AI landscape over the coming years, the near-term prospects seem a bit more cloudy as [Google] appears to be rapidly gaining…