Balancing Dividends and Fundamentals: The Case of NASDAQ:MSFT.

Take a closer look at MICROSOFT CORP (NASDAQ:MSFT), a stock of interest to dividend investors uncovered by our stock screener. NASDAQ:MSFT excels in fundamentals and provides a decent dividend, all while maintaining a reasonable valuation. Let's break it down further.

Dividend Assessment of NASDAQ:MSFT

An integral part of ChartMill's stock analysis is the Dividend Rating, which spans from 0 to 10. This rating evaluates diverse dividend factors, including yield, historical data, growth, and sustainability. NASDAQ:MSFT has received a 7 out of 10:

• MSFT's Dividend Yield is rather good when compared to the industry average which is at 5437.59. MSFT pays more dividend than 91.43% of the companies in the same industry.
• The dividend of MSFT is nicely growing with an annual growth rate of 10.00%!
• MSFT has been paying a dividend for at least 10 years, so it has a reliable track record.
• MSFT has not decreased their dividend for at least 10 years, which is a reliable track record.
• MSFT pays out 27.36% of its income as dividend. This is a sustainable payout ratio.
• MSFT's earnings are growing more than its dividend. This makes the dividend growth sustainable.

Evaluating Health: NASDAQ:MSFT

To gauge a stock's financial health, ChartMill utilizes a Health Rating on a scale of 0 to 10. This comprehensive evaluation encompasses liquidity and solvency, both in absolute terms and in comparison to industry peers. NASDAQ:MSFT has earned a 8 out of 10:

• An Altman-Z score of 8.67 indicates that MSFT is not in any danger for bankruptcy at the moment.
• MSFT's Altman-Z score of 8.67 is amongst the best of the industry. MSFT outperforms 89.64% of its industry peers.
• The Debt to FCF ratio of MSFT is 1.08, which is an excellent value as it means it would take MSFT, only 1.08 years of fcf income to pay off all of its debts.
• MSFT has a Debt to FCF ratio of 1.08. This is in the better half of the industry: MSFT outperforms 78.21% of its industry peers.
• MSFT has a Debt/Equity ratio of 0.28. This is a healthy value indicating a solid balance between debt and equity.
• The current and quick ratio evaluation for MSFT is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.

Understanding NASDAQ:MSFT's Profitability

ChartMill utilizes a Profitability Rating to assess stocks, scoring them on a scale of 0 to 10. This rating takes into account a variety of profitability ratios and margins, both in absolute terms and in comparison to industry peers. NASDAQ:MSFT has earned a 8 out of 10:

• MSFT has a Return On Assets of 17.56%. This is amongst the best in the industry. MSFT outperforms 98.57% of its industry peers.
• MSFT has a better Return On Equity (35.09%) than 97.14% of its industry peers.
• The Return On Invested Capital of MSFT (24.46%) is better than 98.21% of its industry peers.
• Measured over the past 3 years, the Average Return On Invested Capital for MSFT is significantly above the industry average of 10.81%.
• MSFT has a better Profit Margin (34.15%) than 97.86% of its industry peers.
• In the last couple of years the Profit Margin of MSFT has grown nicely.
• With an excellent Operating Margin value of 42.33%, MSFT belongs to the best of the industry, outperforming 99.64% of the companies in the same industry.
• MSFT's Operating Margin has improved in the last couple of years.

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Our latest full fundamental report of MSFT contains the most current fundamental analsysis.

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.