MICROSOFT CORP (1MSFT.MI) Stock Fundamental Analysis
BIT:1MSFT - Euronext Milan - US5949181045 - Common Stock - Currency: EUR
Overall 1MSFT gets a fundamental rating of 6 out of 10. We evaluated 1MSFT against 100 industry peers in the Software industry. 1MSFT gets an excellent profitability rating and is at the same time showing great financial health properties. While showing a medium growth rate, 1MSFT is valued expensive at the moment. This makes 1MSFT very considerable for quality investing!
1. Profitability
1.1 Basic Checks
1MSFT had positive earnings in the past year.
In the past year 1MSFT had a positive cash flow from operations.
1MSFT had positive earnings in each of the past 5 years.
1MSFT had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With an excellent Return On Assets value of 17.18%, 1MSFT belongs to the best of the industry, outperforming 97.00% of the companies in the same industry.
Looking at the Return On Equity, with a value of 30.02%, 1MSFT belongs to the top of the industry, outperforming 91.00% of the companies in the same industry.
1MSFT has a better Return On Invested Capital (22.17%) than 96.00% of its industry peers.
The Average Return On Invested Capital over the past 3 years for 1MSFT is significantly above the industry average of 10.48%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.18% | ||
| ROE | 30.02% | ||
| ROIC | 22.17% |
ROA(3y)18.24%
ROA(5y)17.55%
ROE(3y)37.2%
ROE(5y)38.43%
ROIC(3y)23.84%
ROIC(5y)22.71%
1.3 Margins
Looking at the Profit Margin, with a value of 35.79%, 1MSFT belongs to the top of the industry, outperforming 99.00% of the companies in the same industry.
1MSFT's Profit Margin has improved in the last couple of years.
1MSFT's Operating Margin of 45.23% is amongst the best of the industry. 1MSFT outperforms 99.00% of its industry peers.
In the last couple of years the Operating Margin of 1MSFT has grown nicely.
1MSFT has a Gross Margin (69.07%) which is in line with its industry peers.
In the last couple of years the Gross Margin of 1MSFT has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 45.23% | ||
| PM (TTM) | 35.79% | ||
| GM | 69.07% |
OM growth 3Y2.39%
OM growth 5Y5.51%
PM growth 3Y-0.46%
PM growth 5Y2.89%
GM growth 3Y0.4%
GM growth 5Y1.15%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), 1MSFT is creating value.
Compared to 1 year ago, 1MSFT has about the same amount of shares outstanding.
1MSFT has less shares outstanding than it did 5 years ago.
1MSFT has a better debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 10.30 indicates that 1MSFT is not in any danger for bankruptcy at the moment.
With an excellent Altman-Z score value of 10.30, 1MSFT belongs to the best of the industry, outperforming 91.00% of the companies in the same industry.
The Debt to FCF ratio of 1MSFT is 1.18, which is an excellent value as it means it would take 1MSFT, only 1.18 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 1.18, 1MSFT is doing good in the industry, outperforming 78.00% of the companies in the same industry.
1MSFT has a Debt/Equity ratio of 0.24. This is a healthy value indicating a solid balance between debt and equity.
With a decent Debt to Equity ratio value of 0.24, 1MSFT is doing good in the industry, outperforming 61.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | 1.18 | ||
| Altman-Z | 10.3 |
ROIC/WACC2.02
WACC10.97%
2.3 Liquidity
A Current Ratio of 1.37 indicates that 1MSFT should not have too much problems paying its short term obligations.
1MSFT has a Current ratio (1.37) which is comparable to the rest of the industry.
1MSFT has a Quick Ratio of 1.36. This is a normal value and indicates that 1MSFT is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.36, 1MSFT is in the better half of the industry, outperforming 61.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.37 | ||
| Quick Ratio | 1.36 |
3. Growth
3.1 Past
1MSFT shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 12.03%, which is quite good.
Measured over the past years, 1MSFT shows a quite strong growth in Earnings Per Share. The EPS has been growing by 19.98% on average per year.
Looking at the last year, 1MSFT shows a quite strong growth in Revenue. The Revenue has grown by 14.13% in the last year.
1MSFT shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 14.26% yearly.
EPS 1Y (TTM)12.03%
EPS 3Y14.01%
EPS 5Y19.98%
EPS Q2Q%17.69%
Revenue 1Y (TTM)14.13%
Revenue growth 3Y13.4%
Revenue growth 5Y14.26%
Sales Q2Q%13.27%
3.2 Future
Based on estimates for the next years, 1MSFT will show a quite strong growth in Earnings Per Share. The EPS will grow by 14.79% on average per year.
1MSFT is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 13.18% yearly.
EPS Next Y15.38%
EPS Next 2Y14.13%
EPS Next 3Y15.04%
EPS Next 5Y14.79%
Revenue Next Year13.95%
Revenue Next 2Y13.7%
Revenue Next 3Y13.92%
Revenue Next 5Y13.18%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
1MSFT is valuated quite expensively with a Price/Earnings ratio of 34.77.
Based on the Price/Earnings ratio, 1MSFT is valued a bit cheaper than 71.00% of the companies in the same industry.
1MSFT is valuated rather expensively when we compare the Price/Earnings ratio to 25.82, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 29.25, 1MSFT can be considered very expensive at the moment.
1MSFT's Price/Forward Earnings is on the same level as the industry average.
1MSFT is valuated rather expensively when we compare the Price/Forward Earnings ratio to 21.76, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.77 | ||
| Fwd PE | 29.25 |
4.2 Price Multiples
1MSFT's Enterprise Value to EBITDA ratio is in line with the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of 1MSFT indicates a somewhat cheap valuation: 1MSFT is cheaper than 62.00% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 48.21 | ||
| EV/EBITDA | 22.1 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
1MSFT has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as 1MSFT's earnings are expected to grow with 15.04% in the coming years.
PEG (NY)2.26
PEG (5Y)1.74
EPS Next 2Y14.13%
EPS Next 3Y15.04%
5. Dividend
5.1 Amount
With a yearly dividend of 0.73%, 1MSFT is not a good candidate for dividend investing.
1MSFT's Dividend Yield is a higher than the industry average which is at 1.96.
Compared to an average S&P500 Dividend Yield of 2.36, 1MSFT's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.73% |
5.2 History
On average, the dividend of 1MSFT grows each year by 10.19%, which is quite nice.
Dividend Growth(5Y)10.19%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
24.30% of the earnings are spent on dividend by 1MSFT. This is a low number and sustainable payout ratio.
The dividend of 1MSFT is growing, but earnings are growing more, so the dividend growth is sustainable.
DP24.3%
EPS Next 2Y14.13%
EPS Next 3Y15.04%
BIT:1MSFT (5/23/2025, 7:00:00 PM)
397.8
-6.15 (-1.52%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners74.18%
Inst Owner ChangeN/A
Ins Owners0.03%
Ins Owner ChangeN/A
Market Cap2957.24B
Analysts84.24
Price Target451.02 (13.38%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.73% |
Yearly Dividend2.62
Dividend Growth(5Y)10.19%
DP24.3%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.56%
Min EPS beat(2)1.79%
Max EPS beat(2)5.34%
EPS beat(4)3
Avg EPS beat(4)2.53%
Min EPS beat(4)-1.43%
Max EPS beat(4)5.34%
EPS beat(8)7
Avg EPS beat(8)3.7%
EPS beat(12)9
Avg EPS beat(12)2.65%
EPS beat(16)12
Avg EPS beat(16)3.43%
Revenue beat(2)1
Avg Revenue beat(2)-0.18%
Min Revenue beat(2)-0.75%
Max Revenue beat(2)0.4%
Revenue beat(4)1
Avg Revenue beat(4)-0.53%
Min Revenue beat(4)-1.44%
Max Revenue beat(4)0.4%
Revenue beat(8)2
Avg Revenue beat(8)-0.25%
Revenue beat(12)3
Avg Revenue beat(12)-0.56%
Revenue beat(16)5
Avg Revenue beat(16)-0.31%
PT rev (1m)-3.25%
PT rev (3m)-6.3%
EPS NQ rev (1m)1.18%
EPS NQ rev (3m)1.24%
EPS NY rev (1m)1.97%
EPS NY rev (3m)1.95%
Revenue NQ rev (1m)1.9%
Revenue NQ rev (3m)1.55%
Revenue NY rev (1m)0.87%
Revenue NY rev (3m)0.77%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 34.77 | ||
| Fwd PE | 29.25 | ||
| P/S | 12.39 | ||
| P/FCF | 48.21 | ||
| P/OCF | 25.59 | ||
| P/B | 10.39 | ||
| P/tB | 18.73 | ||
| EV/EBITDA | 22.1 |
EPS(TTM)11.44
EY2.88%
EPS(NY)13.6
Fwd EY3.42%
FCF(TTM)8.25
FCFY2.07%
OCF(TTM)15.55
OCFY3.91%
SpS32.12
BVpS38.29
TBVpS21.24
PEG (NY)2.26
PEG (5Y)1.74
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.18% | ||
| ROE | 30.02% | ||
| ROCE | 27.24% | ||
| ROIC | 22.17% | ||
| ROICexc | 26.95% | ||
| ROICexgc | 44.08% | ||
| OM | 45.23% | ||
| PM (TTM) | 35.79% | ||
| GM | 69.07% | ||
| FCFM | 25.69% |
ROA(3y)18.24%
ROA(5y)17.55%
ROE(3y)37.2%
ROE(5y)38.43%
ROIC(3y)23.84%
ROIC(5y)22.71%
ROICexc(3y)35.43%
ROICexc(5y)40.49%
ROICexgc(3y)63.99%
ROICexgc(5y)78.75%
ROCE(3y)29.44%
ROCE(5y)28%
ROICexcg growth 3Y-19.4%
ROICexcg growth 5Y-12.98%
ROICexc growth 3Y-17.33%
ROICexc growth 5Y-7.77%
OM growth 3Y2.39%
OM growth 5Y5.51%
PM growth 3Y-0.46%
PM growth 5Y2.89%
GM growth 3Y0.4%
GM growth 5Y1.15%
F-Score5
Asset Turnover0.48
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | 1.18 | ||
| Debt/EBITDA | 0.5 | ||
| Cap/Depr | 209.15% | ||
| Cap/Sales | 22.72% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 86.3% | ||
| Profit Quality | 71.78% | ||
| Current Ratio | 1.37 | ||
| Quick Ratio | 1.36 | ||
| Altman-Z | 10.3 |
F-Score5
WACC10.97%
ROIC/WACC2.02
Cap/Depr(3y)189.18%
Cap/Depr(5y)172.93%
Cap/Sales(3y)14.49%
Cap/Sales(5y)13.3%
Profit Quality(3y)85.27%
Profit Quality(5y)89.91%
High Growth Momentum
Growth
EPS 1Y (TTM)12.03%
EPS 3Y14.01%
EPS 5Y19.98%
EPS Q2Q%17.69%
EPS Next Y15.38%
EPS Next 2Y14.13%
EPS Next 3Y15.04%
EPS Next 5Y14.79%
Revenue 1Y (TTM)14.13%
Revenue growth 3Y13.4%
Revenue growth 5Y14.26%
Sales Q2Q%13.27%
Revenue Next Year13.95%
Revenue Next 2Y13.7%
Revenue Next 3Y13.92%
Revenue Next 5Y13.18%
EBIT growth 1Y15.48%
EBIT growth 3Y16.11%
EBIT growth 5Y20.56%
EBIT Next Year40.13%
EBIT Next 3Y21.81%
EBIT Next 5Y19.44%
FCF growth 1Y20.83%
FCF growth 3Y9.69%
FCF growth 5Y14.13%
OCF growth 1Y56.65%
OCF growth 3Y15.6%
OCF growth 5Y17.83%