As a general rule, I ignore Wall Street's non-stop merry-go-round of upgrades and downgrades. However, while the prognostications about where a stock price is headed over the coming year are virtually meaningless to long-term investors, the logic behind the moves can yield valuable insight regarding a company's prospects. Such is the case here.

Truist Securities analyst Joel Fishbein initiated coverage of (NASDAQ: MSFT) stock, issuing a buy rating and three-year price target of $600. That represents potential gains for investors of 60%, compared to the stock's closing price on Wednesday, even though it's moved 56% higher so far this year. Also, note the three-year time frame, which makes his view more valuable to long-term investors.

At first glance, the math doesn't appear to be a stretch as it suggests a compound annual growth rate of roughly 17%. Notwithstanding last year's historic downturn, Microsoft stock has gained 75% (or 21% annually) over the past three years, so the analyst isn't going out on a limb here.

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Source Fool.com