MICROSOFT CORP (MSF.DE) Stock Fundamental Analysis
FRA:MSF - US5949181045 - Common Stock
426.3 EUR
+0.35 (+0.08%)
We assign a fundamental rating of 7 out of 10 to MSF. MSF was compared to 101 industry peers in the Software industry. MSF scores excellent points on both the profitability and health parts. This is a solid base for a good stock. MSF is valied quite expensively at the moment, while it does show a decent growth rate. This makes MSF very considerable for quality investing!
1. Profitability
1.1 Basic Checks
In the past year MSF was profitable.
MSF had a positive operating cash flow in the past year.
In the past 5 years MSF has always been profitable.
Each year in the past 5 years MSF had a positive operating cash flow.
1.2 Ratios
MSF's Return On Assets of 16.45% is amongst the best of the industry. MSF outperforms 93.07% of its industry peers.
Looking at the Return On Equity, with a value of 29.65%, MSF belongs to the top of the industry, outperforming 88.12% of the companies in the same industry.
MSF's Return On Invested Capital of 22.08% is amongst the best of the industry. MSF outperforms 91.09% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for MSF is significantly above the industry average of 12.69%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 16.45% | ||
| ROE | 29.65% | ||
| ROIC | 22.08% |
ROA(3y)17.07%
ROA(5y)17.9%
ROE(3y)32.52%
ROE(5y)36.88%
ROIC(3y)22.94%
ROIC(5y)23.52%
1.3 Margins
MSF has a Profit Margin of 36.15%. This is amongst the best in the industry. MSF outperforms 94.06% of its industry peers.
In the last couple of years the Profit Margin of MSF has grown nicely.
With an excellent Operating Margin value of 45.62%, MSF belongs to the best of the industry, outperforming 96.04% of the companies in the same industry.
In the last couple of years the Operating Margin of MSF has grown nicely.
Looking at the Gross Margin, with a value of 68.82%, MSF is in line with its industry, outperforming 46.53% of the companies in the same industry.
MSF's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 45.62% | ||
| PM (TTM) | 36.15% | ||
| GM | 68.82% |
OM growth 3Y2.75%
OM growth 5Y4.26%
PM growth 3Y-0.49%
PM growth 5Y3.14%
GM growth 3Y0.21%
GM growth 5Y0.31%
2. Health
2.1 Basic Checks
MSF has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, MSF has about the same amount of shares outstanding.
The number of shares outstanding for MSF has been reduced compared to 5 years ago.
MSF has a better debt/assets ratio than last year.
2.2 Solvency
MSF has an Altman-Z score of 9.87. This indicates that MSF is financially healthy and has little risk of bankruptcy at the moment.
The Altman-Z score of MSF (9.87) is better than 88.12% of its industry peers.
MSF has a debt to FCF ratio of 1.25. This is a very positive value and a sign of high solvency as it would only need 1.25 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 1.25, MSF is doing good in the industry, outperforming 75.25% of the companies in the same industry.
A Debt/Equity ratio of 0.24 indicates that MSF is not too dependend on debt financing.
MSF has a Debt to Equity ratio (0.24) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | 1.25 | ||
| Altman-Z | 9.87 |
ROIC/WACC2
WACC11.06%
2.3 Liquidity
MSF has a Current Ratio of 1.35. This is a normal value and indicates that MSF is financially healthy and should not expect problems in meeting its short term obligations.
MSF has a Current ratio (1.35) which is comparable to the rest of the industry.
A Quick Ratio of 1.35 indicates that MSF should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.35, MSF is in line with its industry, outperforming 55.45% of the companies in the same industry.
The current and quick ratio evaluation for MSF 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.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.35 | ||
| Quick Ratio | 1.35 |
3. Growth
3.1 Past
MSF shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 15.50%, which is quite good.
MSF shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 18.86% yearly.
Looking at the last year, MSF shows a quite strong growth in Revenue. The Revenue has grown by 14.93% in the last year.
MSF shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 14.52% yearly.
EPS 1Y (TTM)15.5%
EPS 3Y14.03%
EPS 5Y18.86%
EPS Q2Q%23.73%
Revenue 1Y (TTM)14.93%
Revenue growth 3Y12.42%
Revenue growth 5Y14.52%
Sales Q2Q%18.1%
3.2 Future
The Earnings Per Share is expected to grow by 15.23% on average over the next years. This is quite good.
MSF is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 11.89% yearly.
EPS Next Y15.95%
EPS Next 2Y16.49%
EPS Next 3Y17.54%
EPS Next 5Y15.23%
Revenue Next Year15.5%
Revenue Next 2Y14.92%
Revenue Next 3Y15.04%
Revenue Next 5Y11.89%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 36.72, the valuation of MSF can be described as expensive.
Based on the Price/Earnings ratio, MSF is valued a bit cheaper than the industry average as 68.32% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 27.07. MSF is valued slightly more expensive when compared to this.
Based on the Price/Forward Earnings ratio of 31.66, the valuation of MSF can be described as expensive.
Compared to the rest of the industry, the Price/Forward Earnings ratio of MSF is on the same level as its industry peers.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.59, MSF is valued a bit more expensive.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 36.72 | ||
| Fwd PE | 31.66 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of MSF is on the same level as its industry peers.
MSF's Price/Free Cash Flow ratio is in line with the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 51.97 | ||
| EV/EBITDA | 22.43 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
MSF has an outstanding profitability rating, which may justify a higher PE ratio.
MSF's earnings are expected to grow with 17.54% in the coming years. This may justify a more expensive valuation.
PEG (NY)2.3
PEG (5Y)1.95
EPS Next 2Y16.49%
EPS Next 3Y17.54%
5. Dividend
5.1 Amount
With a yearly dividend of 0.65%, MSF is not a good candidate for dividend investing.
MSF's Dividend Yield is a higher than the industry average which is at 2.06.
Compared to an average S&P500 Dividend Yield of 2.46, MSF's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.65% |
5.2 History
The dividend of MSF is nicely growing with an annual growth rate of 10.24%!
Dividend Growth(5Y)10.24%
Div Incr Years6
Div Non Decr Years6
5.3 Sustainability
MSF pays out 23.65% of its income as dividend. This is a sustainable payout ratio.
MSF's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP23.65%
EPS Next 2Y16.49%
EPS Next 3Y17.54%
FRA:MSF (9/10/2025, 12:13:28 PM)
426.3
+0.35 (+0.08%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners74.49%
Inst Owner ChangeN/A
Ins Owners0.03%
Ins Owner ChangeN/A
Market Cap3168.76B
Analysts85.71
Price Target529.47 (24.2%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.65% |
Yearly Dividend2.77
Dividend Growth(5Y)10.24%
DP23.65%
Div Incr Years6
Div Non Decr Years6
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)5.77%
Min EPS beat(2)5.34%
Max EPS beat(2)6.2%
EPS beat(4)4
Avg EPS beat(4)4.44%
Min EPS beat(4)1.79%
Max EPS beat(4)6.2%
EPS beat(8)7
Avg EPS beat(8)4.04%
EPS beat(12)10
Avg EPS beat(12)3.55%
EPS beat(16)12
Avg EPS beat(16)3.12%
Revenue beat(2)2
Avg Revenue beat(2)0.97%
Min Revenue beat(2)0.4%
Max Revenue beat(2)1.54%
Revenue beat(4)2
Avg Revenue beat(4)0.21%
Min Revenue beat(4)-0.75%
Max Revenue beat(4)1.54%
Revenue beat(8)3
Avg Revenue beat(8)0.03%
Revenue beat(12)4
Avg Revenue beat(12)-0.18%
Revenue beat(16)5
Avg Revenue beat(16)-0.36%
PT rev (1m)13.59%
PT rev (3m)16.82%
EPS NQ rev (1m)0.45%
EPS NQ rev (3m)3.37%
EPS NY rev (1m)2.74%
EPS NY rev (3m)2.81%
Revenue NQ rev (1m)0.35%
Revenue NQ rev (3m)2.31%
Revenue NY rev (1m)1.75%
Revenue NY rev (3m)1.81%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 36.72 | ||
| Fwd PE | 31.66 | ||
| P/S | 13.21 | ||
| P/FCF | 51.97 | ||
| P/OCF | 27.33 | ||
| P/B | 10.83 | ||
| P/tB | 18.48 | ||
| EV/EBITDA | 22.43 |
EPS(TTM)11.61
EY2.72%
EPS(NY)13.47
Fwd EY3.16%
FCF(TTM)8.2
FCFY1.92%
OCF(TTM)15.6
OCFY3.66%
SpS32.27
BVpS39.35
TBVpS23.07
PEG (NY)2.3
PEG (5Y)1.95
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 16.45% | ||
| ROE | 29.65% | ||
| ROCE | 26.9% | ||
| ROIC | 22.08% | ||
| ROICexc | 27.53% | ||
| ROICexgc | 43.75% | ||
| OM | 45.62% | ||
| PM (TTM) | 36.15% | ||
| GM | 68.82% | ||
| FCFM | 25.42% |
ROA(3y)17.07%
ROA(5y)17.9%
ROE(3y)32.52%
ROE(5y)36.88%
ROIC(3y)22.94%
ROIC(5y)23.52%
ROICexc(3y)31.07%
ROICexc(5y)36.94%
ROICexgc(3y)52.63%
ROICexgc(5y)67.5%
ROCE(3y)28.11%
ROCE(5y)28.75%
ROICexcg growth 3Y-18.02%
ROICexcg growth 5Y-15.78%
ROICexc growth 3Y-12.77%
ROICexc growth 5Y-10.15%
OM growth 3Y2.75%
OM growth 5Y4.26%
PM growth 3Y-0.49%
PM growth 5Y3.14%
GM growth 3Y0.21%
GM growth 5Y0.31%
F-Score5
Asset Turnover0.46
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | 1.25 | ||
| Debt/EBITDA | 0.51 | ||
| Cap/Depr | 189.01% | ||
| Cap/Sales | 22.91% | ||
| Interest Coverage | 80.33 | ||
| Cash Conversion | 83.7% | ||
| Profit Quality | 70.32% | ||
| Current Ratio | 1.35 | ||
| Quick Ratio | 1.35 | ||
| Altman-Z | 9.87 |
F-Score5
WACC11.06%
ROIC/WACC2
Cap/Depr(3y)197.12%
Cap/Depr(5y)186.6%
Cap/Sales(3y)18.11%
Cap/Sales(5y)15.73%
Profit Quality(3y)78.85%
Profit Quality(5y)83.54%
High Growth Momentum
Growth
EPS 1Y (TTM)15.5%
EPS 3Y14.03%
EPS 5Y18.86%
EPS Q2Q%23.73%
EPS Next Y15.95%
EPS Next 2Y16.49%
EPS Next 3Y17.54%
EPS Next 5Y15.23%
Revenue 1Y (TTM)14.93%
Revenue growth 3Y12.42%
Revenue growth 5Y14.52%
Sales Q2Q%18.1%
Revenue Next Year15.5%
Revenue Next 2Y14.92%
Revenue Next 3Y15.04%
Revenue Next 5Y11.89%
EBIT growth 1Y17.45%
EBIT growth 3Y15.52%
EBIT growth 5Y19.4%
EBIT Next Year49.13%
EBIT Next 3Y27.09%
EBIT Next 5Y25.57%
FCF growth 1Y-3.32%
FCF growth 3Y3.2%
FCF growth 5Y9.62%
OCF growth 1Y14.86%
OCF growth 3Y15.21%
OCF growth 5Y17.55%