Morgan Stanley (NYSE:MS) adjusted its outlook on shares of Microsoft stock (NASDAQ:MSFT), reducing the price target to $540 from the previous $548, yet reaffirming an Overweight rating. The decision comes amidst growing concerns among investors regarding various financial metrics and strategic partnerships.

That’s according to a team at Morgan Stanley led by chief U.S. stock-market strategist Mike Wilson, who told clients that its conviction in quality stocks has increased of late amid rising rates. Morgan Stanley has in the past described quality companies as well-managed with sustainably high, long-term returns and strong balance sheets.

On Wednesday, Microsoft ( MSFT, Financial) shares grew nearly 3% despite Morgan Stanley lowering their price target from $548 to $540. However, the investment company kept its Overweight rating to reflect its belief in Microsoft's future growth while standing behind Microsoft's market leadership and new artificial intelligence technology prospects.