Analysts See Street Views Falling On Microsoft Inc. After FQ3 Results

A strong dollar and a weak market for personal computers may result in lower expectations for Microsoft Inc.

following its fiscal third-quarter earnings report after the bell Wednesday. "Consensus estimates clearly need to come down," according to Wells Fargo's Jason Maynard, who cut his fiscal 2016 forecast but upgraded the company to Outperform, citing its 7 percent stock price decline since Jan. 1. Microsoft, trading recently at $43.26, up $0.28 cents, is expected to post a 25 percent decline in third-quarter earnings to $0.51 cents, while revenue will grow about 2 percent to $21.06 billion. Global PC sales fell by between 5.2 percent and 6.7 percent during the first three months of 2015, according to recent estimates by Gartner Inc.

and IDC. Maynard "isn't expecting much" from the pending launch of Microsoft's latest Windows 10 operating system, and doesn't expect it will move the stock. But Bank of America's Kash Rangan sees risk in the upcoming event. "It's a big question" how many consumers will chose a free upgrade versus a new computer, according to Rangan, who maintains an Underperform rating on Microsoft. Deutsche Bank's Karl Keirstead and Morgan Stanley's Keith Weiss both maintained Hold ratings on Microsoft, citing weak PC sales an uncertainty surrounding billings growth related to its cloud services. But CLSA's Ed McGuire reiterated an Outperform rating and said that beyond foreign exchange worries and the PC market, Microsoft is "well-positioned" in providing business services related to the cloud.