Microsoft Fundamentals

MSFT
 Stock
  

USD 244.37  0.75  0.31%   

Microsoft fundamentals help investors to digest information that contributes to Microsoft's financial success or failures. It also enables traders to predict the movement of Microsoft Stock. The fundamental analysis module provides a way to measure Microsoft's intrinsic value by examining its available economic and financial indicators, including the cash flow records, the balance sheet account changes, the income statement patterns, and various microeconomic indicators and financial ratios related to Microsoft stock.
This module does not cover all equities due to inconsistencies in global equity categorizations. Continue to Equity Screeners to view more equity screening tools.
  
Microsoft Direct Expenses is comparatively stable at the moment as compared to the past year. Microsoft reported Direct Expenses of 62.65 Billion in 2021. Consolidated Income is likely to gain to about 78.5 B in 2022, whereas Gross Profit is likely to drop slightly above 116.5 B in 2022.

Microsoft Price to Earning Analysis

Microsoft's Price to Earnings ratio is typically used for current valuation of a company and is one of the most popular ratios that investors monitor daily. Holding a low PE stock is less risky because when a company's profitability falls, it is likely that earnings will also go down as well. In other words, if you start from a lower position, your downside risk is limited. There are also some investors who believe that low Price to Earnings ratio reflects the low pricing because a given company is in trouble. On the other hand, a higher PE ratio means that investors are paying more for each unit of profit.
P/E 
 = 
Market Value Per Share 
Earnings Per Share 
More About Price to Earning | All Equity Analysis

Current Microsoft Price to Earning

    
  26.64 X  
Most of Microsoft's fundamental indicators, such as Price to Earning, are part of a valuation analysis module that helps investors searching for stocks that are currently trading at higher or lower prices than their real value. If the real value is higher than the market price, Microsoft is considered to be undervalued, and we provide a buy recommendation. Otherwise, we render a sell signal.

Microsoft Price to Earning Historical Pattern

Today, most investors in Microsoft Stock are looking for potential investment opportunities by analyzing not only static indicators but also various Microsoft's growth ratios. Consistent increases or drops in fundamental ratios usually indicate a possible pattern that can be successfully translated into profits. However, when comparing two companies, knowing each company's price to earning growth rates may not be enough to decide which company is a better investment. That's why investors frequently use a static breakdown of Microsoft price to earning as a starting point in their analysis.
   Microsoft Price to Earning   
Share
       Timeline  
Generally speaking, the Price to Earnings ratio gives investors an idea of what the market is willing to pay for the company's current earnings.
Compare to competition

Microsoft Accumulated Retained Earnings Deficit

Accumulated Retained Earnings Deficit

90.93 Billion

Microsoft Accumulated Retained Earnings Deficit are comparatively stable at the moment as compared to the past year. Microsoft reported Accumulated Retained Earnings Deficit of 84.28 Billion in 2021
Based on the latest financial disclosure, the price to earning indicator of Microsoft is roughly 26.64 times. This is 3.76% lower than that of the Software sector and significantly higher than that of the Information Technology industry. The price to earning for all United States stocks is 7.24% higher than that of the company.

Microsoft Fundamental Drivers Relationships

Comparative valuation techniques use various fundamental indicators to help in determining Microsoft's current stock value. Our valuation model uses many indicators to compare Microsoft value to that of its competitors to determine the firm's financial worth. You can analyze the relationship between different fundamental ratios across Microsoft competition to find correlations between indicators driving Microsoft's intrinsic value. More Info.
Microsoft is considered to be number one stock in earnings per share category among related companies. It is considered to be number one stock in beta category among related companies totaling about  0.10  of Beta per Earnings Per Share. The ratio of Earnings Per Share to Beta for Microsoft is roughly  9.95 . Comparative valuation analysis is a catch-all model that can be used if you cannot value Microsoft by discounting back its dividends or cash flows. This model doesn't attempt to find an intrinsic value for Microsoft's Stock . Still, instead, it compares the stock's price multiples to a benchmark or nearest competition to determine if the stock is relatively undervalued or overvalued. The reason why the comparable model can be used in almost all circumstances is due to the vast number of multiples that can be utilized, such as the price-to-earnings (P/E), price-to-book (P/B), price-to-sales (P/S), price-to-cash flow (P/CF), and many others. The P/E ratio is the most commonly used of these ratios because it focuses on the Microsoft's earnings, one of the primary drivers of an investment's value.

Microsoft Price to Earnings To Growth Peer Comparison

Stock peer comparison is one of the most widely used and accepted methods of equity analyses. It analyses Microsoft's direct or indirect competition against its Price to Earnings To Growth to detect undervalued stocks with similar characteristics or determine the stocks which would be a good addition to a portfolio. Peer analysis of Microsoft could also be used in its relative valuation, which is a method of valuing Microsoft by comparing valuation metrics of similar companies.
Microsoft is currently under evaluation in price to earnings to growth category among related companies.

Microsoft Current Valuation Drivers

We derive many important indicators used in calculating different scores of Microsoft from analyzing Microsoft's financial statements. These drivers represent accounts that assess Microsoft's ability to generate profits relative to its revenue, operating costs, and shareholders' equity. Below are some of Microsoft's important valuation drivers and their relationship over time.
201720182019202020212022 (projected)
Net Income Per Employee169.9 K272.5 K270.92 K338.51 K329.13 K265.33 K
Revenue Per Employee1.13 M873.91 K875 K928.66 K897.15 K818.65 K
Average Assets252.36 B266.58 B287.13 B311.95 B346.31 B311.27 B
Earnings Before Interest Taxes and Depreciation Amortization EBITDA44.69 B53.31 B63.65 B80.62 B83.7 B90.31 B
Earnings Before Interest Taxes and Depreciation Amortization USD49.47 B58.06 B68.42 B85.13 B100.24 B81.78 B
Earnings before Tax36.47 B43.69 B53.04 B71.1 B83.72 B67.18 B
Average Equity82.49 B93.82 B112.24 B132.53 B160.36 B139.34 B
Enterprise Value708.28 B973.97 B1,479.54 B1,982.23 B1,877.43 B2,025.65 B
Free Cash Flow32.25 B38.26 B45.23 B56.12 B65.15 B55.24 B
Invested Capital104.66 B111.91 B113.08 B125.05 B147.45 B124.34 B
Invested Capital Average105.36 B108.1 B113.54 B120.65 B141.25 B118.76 B
Market Capitalization757.64 B1,026.51 B1,543.31 B2,040.3 B1,920.84 B2,072.49 B
Tangible Asset Value215.11 B236.78 B250.92 B276.27 B286.02 B264.71 B
Working Capital111.17 B106.13 B109.61 B95.75 B74.6 B88.88 B

Microsoft ESG Sustainability

Some studies have found that companies with high sustainability scores are getting higher valuations than competitors with lower social-engagement activities. While most ESG disclosures are voluntary and do not directly affect the long term financial condition, Microsoft's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Microsoft's managers, analysts, and investors.
Environment Score
Governance Score
Social Score

Microsoft Fundamentals

About Microsoft Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze Microsoft's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Microsoft using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Microsoft based on its fundamental data. In general, a quantitative approach, as applied to this company, focuses on analyzing financial statements comparatively, whereas a qaualitative method uses data that is important to a company's growth but cannot be measured and presented in a numerical way.
Please read more on our fundamental analysis page.
Last ReportedProjected for 2022
Deferred Revenue48.4 B44.2 B
Cost of Revenue62.6 B54.4 B
Revenues198.3 B213.9 B
Revenue to Assets 0.54  0.59 
Revenue Per Employee897.1 K818.6 K

Microsoft Investors Sentiment

The influence of Microsoft's investor sentiment on the probability of its price appreciation or decline could be a good factor in your decision-making process regarding taking a position in Microsoft. The overall investor sentiment generally increases the direction of a stock movement in a one-year investment horizon. However, the impact of investor sentiment on the entire stock markets does not have a solid backing from leading economists and market statisticians.
Investor biases related to Microsoft's public news can be used to forecast risks associated with investment in Microsoft. The trend in average sentiment can be used to explain how an investor holding Microsoft can time the market purely based on public headlines and social activities around Microsoft. Please note that most equiteis that are difficult to arbitrage are affected by market sentiment the most.
Microsoft's market sentiment shows the aggregated news analyzed to detect positive and negative mentions from the text and comments. The data is normalized to provide daily scores for Microsoft's and other traded tickers. The bigger the bubble, the more accurate is the estimated score. Higher bars for a given day show more participation in the average Microsoft's news discussions. The higher the estimated score, the more favorable is the investor's outlook on Microsoft.

Microsoft Implied Volatility

    
  40.28  
Microsoft's implied volatility exposes the market's sentiment of Microsoft stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Microsoft's implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Microsoft stock will not fluctuate a lot when Microsoft's options are near their expiration.
Some investors attempt to determine whether the market's mood is bullish or bearish by monitoring changes in market sentiment. Unlike more traditional methods such as technical analysis, investor sentiment usually refers to the aggregate attitude towards Microsoft in the overall investment community. So, suppose investors can accurately measure the market's sentiment. In that case, they can use it for their benefit. For example, some tools to gauge market sentiment could be utilized using contrarian indexes, Microsoft's short interest history, or implied volatility extrapolated from Microsoft options trading.

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Additionally, see Microsoft Piotroski F Score and Microsoft Altman Z Score analysis. Note that the Microsoft information on this page should be used as a complementary analysis to other Microsoft's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Portfolio Anywhere module to track or share privately all of your investments from the convenience of any device.

Complementary Tools for Microsoft Stock analysis

When running Microsoft price analysis, check to measure Microsoft's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Microsoft is operating at the current time. Most of Microsoft's value examination focuses on studying past and present price action to predict the probability of Microsoft's future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Microsoft's price. Additionally, you may evaluate how the addition of Microsoft to your portfolios can decrease your overall portfolio volatility.
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Is Microsoft's industry expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Microsoft. If investors know Microsoft will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Microsoft listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth YOY
(0.13) 
Market Capitalization
1865.1 B
Quarterly Revenue Growth YOY
0.106
Return On Assets
0.1522
Return On Equity
0.4288
The market value of Microsoft is measured differently than its book value, which is the value of Microsoft that is recorded on the company's balance sheet. Investors also form their own opinion of Microsoft's value that differs from its market value or its book value, called intrinsic value, which is Microsoft's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Microsoft's market value can be influenced by many factors that don't directly affect Microsoft's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Microsoft's value and its price as these two are different measures arrived at by different means. Investors typically determine Microsoft value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Microsoft's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.