Microsoft: Canaccord Cuts Rating to Hold, Lowers Target

Canaccord Adams software analyst Peter Misek today cut his rating on Microsoft (MSFT) to Hold from Buy, while lowering his price target to $24 from $30.

Misek cited two reasons for his more cautious stance. One, he thinks consensus estimates are overly aggressive given the worsening macro spending environment. Misek points out that Microsoft had based its guidance on seeing some improvement in conditions in the second half of the year; Misek says he now questions the validity of that assumption. And two, he sees increasing competitive threats. In operating systems, he notes that the company has lost some share to Apple (AAPL); he thinks some PC OEMs may be looking at competitive alternatives to Vista, including Linux and OS X.

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