Microsoft Corporation (NASDAQ: MSFT) shares are up 74.8% in the past year on optimism about the company’s booming Azure cloud services business.

Microsoft is one of the most widely traded companies in both the stock and options market, but several large option trades stood out on Wednesday morning as particularly large.

The Trades

On Wednesday, Benzinga Pro subscribers received 40 option alerts related to unusually large Microsoft option trades. Here are some of the largest:

At 9:57 a.m. ET, a trader bought 20,000 Microsoft call options with a $200 strike price expiring on March 20. The contracts were purchased at the ask price of $1.39 and represented a $2.78 million bullish bet.

Less than a minute later, a trader sold 4,549 Microsoft call options with a $195 strike price expiring on May 15. The contracts were sold at the bid price of $5.151 and represented a $2.34 million bearish bet.

At 11:21 a.m. ET, a trader bought 1,695 Microsoft call options with a $190 strike price expiring on May 15. The contracts were purchased near the ask price at $7.151 and represented a $1.21 million bullish bet.

At 11:43 a.m. ET, a trader bought 1,843 Microsoft call options with a $190 strike price expiring on May 15. The contracts were purchased at the ask price of $7.401 and represented a $1.36 million bullish bet.

Of the 40 total large Microsoft option trades on Tuesday morning, 21 were calls were purchased at or near the ask or puts sold at or near the bid, trades typically seen as bullish. The remaining 19 trades were calls sold at the near the bid or puts purchases at or near the ask, trades typically seen as bearish.

PreMarket Prep Stock Of The Day: Microsoft

Why It's Important

Even traders who stick exclusively to stocks often monitor option market activity closely for unusually large trades. Given the relative complexity of the options market, large options traders are typically considered to be more sophisticated than the average stock trader. Many of these large options traders are wealthy individuals or institutions who may have unique information or theses related to the underlying stock.

Unfortunately, stock traders often use the options market to hedge against their large stock positions, and there’s no surefire way to determine if an options trade is a standalone position or a hedge. In this case, given the relatively large sizes and the timing of the biggest Microsoft option trades, there’s certainly a possibility they represent institutional hedging.

Uncertain Outlook

The mixed nature of the Microsoft option trading may be a reflection of investors questioning further bullish catalysts for Microsoft.

On Jan. 29, Microsoft reported fiscal second-quarter revenue and earnings well above consensus analyst expectations and issued better-than-expected second-quarter revenue guidance as well. While Microsoft’s fundamental business seems to be firing on all cylinders, the stock’s recent run has pushed its market cap to $1.4 trillion.

Microsoft received almost universal praise from Wall Street following its big quarter, and not a single one of the 34 analysts covering the stock has a Sell rating on the stock. Option traders may be starting to wonder what else Microsoft can do in the near-term to push its $1.4 trillion market cap even higher.

Bullish sentiment among StockTwits messages mentioning Microsoft has remained relatively stable over the past two months, hovering right around 90%.

MSFT Chart by TradingView new TradingView.widget( { "width": 980, "height": 610, "symbol": "NASDAQ:MSFT", "interval": "D", "timezone": "Etc/UTC", "theme": "Light", "style": "1", "locale": "en", "toolbar_bg": "#f1f3f6", "enable_publishing": false, "allow_symbol_change": true, "container_id": "tradingview_02422" } ); Benzinga’s Take

Wall Street analyst and retail StockTwits users are almost universally bullish on Microsoft, which just reported an impressive quarter across-the-board. After the stock’s huge run in the past year, option traders appear to be mixed as to whether or not Microsoft can continue to exceed sky-high expectations.

Do you agree with this take? Email feedback@benzinga.com with your thoughts.

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