Read Why SMBC Nikko Is Bullish on Microsoft

A Microsoft logo is seen on an office building in New York on July 28, 2015. Mike Segar/Reuters

SMBC Nikko analyst Steve Koenig initiated coverage of Microsoft Corp. with an Outperform rating and $410 price target.

The price target implies an upside of 28 percent. Microsoft is successfully transitioning its customers to the cloud.