Microsoft Valuation
Is MSFT * undervalued compared to its fair value, analyst forecasts and its price relative to the market?
Valuation Score
2/6Valuation Score 2/6
Below Fair Value
Significantly Below Fair Value
Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Analyst Forecast
Share Price vs Fair Value
What is the Fair Price of MSFT * when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.
Below Fair Value: MSFT * (MX$8457) is trading above our estimate of fair value (MX$7890.98)
Significantly Below Fair Value: MSFT * is trading above our estimate of fair value.
Key Valuation Metric
Which metric is best to use when looking at relative valuation for MSFT *?
Key metric: As MSFT * is profitable we use its Price-To-Earnings Ratio for relative valuation analysis.
| What is MSFT *'s PE Ratio? | |
|---|---|
| PE Ratio | 34.1x |
| Earnings | US$90.51b |
| Market Cap | US$3.09t |
| Key Statistics | |
|---|---|
| Enterprise Value/Revenue | 12.2x |
| Enterprise Value/EBITDA | 22.7x |
| PEG Ratio | 2.7x |
Price to Earnings Ratio vs Peers
How does MSFT *'s PE Ratio compare to its peers?
| Company | Forward PE | Estimated Growth | Market Cap |
|---|---|---|---|
| Peer Average | 74.3x | ||
ORCL Oracle | 46.9x | 16.5% | US$509.2b |
NOW ServiceNow | 155.3x | 21.7% | US$208.7b |
PANW Palo Alto Networks | 49.1x | -2.3% | US$126.6b |
FTNT Fortinet | 46x | 10.4% | US$72.2b |
MSFT * Microsoft | 34.1x | 12.5% | Mex$3.1t |
Price-To-Earnings vs Peers: MSFT * is good value based on its Price-To-Earnings Ratio (34.1x) compared to the peer average (74.7x).
Price to Earnings Ratio vs Industry
How does MSFT *'s PE Ratio compare vs other companies in the Global Software Industry?
| 32 Companies | Price / Earnings | Estimated Growth | Market Cap |
|---|---|---|---|
| 32 Companies | Estimated Growth | Market Cap | |
|---|---|---|---|
Price-To-Earnings vs Industry: MSFT * is expensive based on its Price-To-Earnings Ratio (34.1x) compared to the Global Software industry average (32x).
Price to Earnings Ratio vs Fair Ratio
What is MSFT *'s PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.
| Fair Ratio | |
|---|---|
| Current PE Ratio | 34.1x |
| Fair PE Ratio | n/a |
Price-To-Earnings vs Fair Ratio: Insufficient data to calculate MSFT *'s Price-To-Earnings Fair Ratio for valuation analysis.
Analyst Price Targets
What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?
| Date | Share Price | Average 1Y Price Target | Dispersion | High | Low | 1Y Actual price | Analysts |
|---|---|---|---|---|---|---|---|
| Current | Mex$8,457.00 | Mex$10,291.52 +21.7% | 7.6% | Mex$12,233.16 | Mex$8,563.21 | n/a | 48 |
| Nov ’25 | Mex$8,319.41 | Mex$10,224.51 +22.9% | 7.6% | Mex$12,165.96 | Mex$8,516.17 | n/a | 48 |
| Oct ’25 | Mex$8,450.00 | Mex$9,682.17 +14.6% | 6.3% | Mex$11,578.02 | Mex$8,490.55 | n/a | 50 |
| Sep ’25 | Mex$8,171.19 | Mex$9,566.09 +17.1% | 6.6% | Mex$11,446.08 | Mex$8,393.79 | n/a | 51 |
| Aug ’25 | Mex$7,800.24 | Mex$9,373.74 +20.2% | 6.8% | Mex$11,263.26 | Mex$8,066.37 | n/a | 52 |
| Jul ’25 | Mex$8,373.67 | Mex$9,007.56 +7.6% | 7.8% | Mex$11,011.86 | Mex$7,886.33 | n/a | 51 |
| Jun ’25 | Mex$6,913.26 | Mex$8,115.73 +17.4% | 7.5% | Mex$10,080.00 | Mex$6,714.96 | n/a | 52 |
| May ’25 | Mex$6,712.10 | Mex$8,180.06 +21.9% | 7.2% | Mex$10,276.08 | Mex$6,845.58 | n/a | 52 |
| Apr ’25 | Mex$7,063.22 | Mex$7,818.87 +10.7% | 7.4% | Mex$9,978.90 | Mex$6,647.61 | n/a | 53 |
| Mar ’25 | Mex$7,067.01 | Mex$7,937.80 +12.3% | 7.4% | Mex$10,228.50 | Mex$6,813.89 | n/a | 51 |
| Feb ’25 | Mex$6,895.72 | Mex$7,807.31 +13.2% | 8.4% | Mex$10,251.90 | Mex$6,322.01 | n/a | 49 |
| Jan ’25 | Mex$6,389.99 | Mex$7,033.29 +10.1% | 9.7% | Mex$10,147.38 | Mex$5,041.56 | n/a | 51 |
| Dec ’24 | Mex$6,440.27 | Mex$6,968.03 +8.2% | 6.9% | Mex$8,137.70 | Mex$5,107.05 | n/a | 50 |
| Nov ’24 | Mex$6,157.22 | Mex$7,270.80 +18.1% | 6.6% | Mex$8,113.41 | Mex$5,374.68 | Mex$8,319.41 | 50 |
| Oct ’24 | Mex$5,510.00 | Mex$6,901.98 +25.3% | 7.4% | Mex$7,713.95 | Mex$5,226.20 | Mex$8,450.00 | 49 |
| Sep ’24 | Mex$5,612.04 | Mex$6,641.28 +18.3% | 10.0% | Mex$7,501.91 | Mex$3,955.55 | Mex$8,171.19 | 49 |
| Aug ’24 | Mex$5,680.54 | Mex$6,579.48 +15.8% | 9.7% | Mex$7,587.59 | Mex$3,911.82 | Mex$7,800.24 | 50 |
| Jul ’24 | Mex$5,832.32 | Mex$5,949.85 +2.0% | 10.9% | Mex$7,708.77 | Mex$3,974.30 | Mex$8,373.67 | 46 |
| Jun ’24 | Mex$5,846.00 | Mex$6,043.55 +3.4% | 10.7% | Mex$7,959.78 | Mex$4,103.71 | Mex$6,913.26 | 47 |
| May ’24 | Mex$5,504.77 | Mex$5,942.72 +8.0% | 9.3% | Mex$7,530.01 | Mex$4,159.44 | Mex$6,712.10 | 48 |
| Apr ’24 | Mex$5,194.94 | Mex$5,432.83 +4.6% | 12.2% | Mex$7,655.09 | Mex$3,864.00 | Mex$7,063.22 | 47 |
| Mar ’24 | Mex$4,459.42 | Mex$5,368.79 +20.4% | 11.2% | Mex$7,548.22 | Mex$3,893.49 | Mex$7,067.01 | 47 |
| Feb ’24 | Mex$4,712.25 | Mex$5,387.45 +14.3% | 11.5% | Mex$7,738.92 | Mex$3,991.85 | Mex$6,895.72 | 47 |
| Jan ’24 | Mex$4,654.00 | Mex$5,762.24 +23.8% | 11.4% | Mex$7,978.29 | Mex$4,542.38 | Mex$6,389.99 | 45 |
| Dec ’23 | Mex$4,895.00 | Mex$5,775.52 +18.0% | 11.5% | Mex$7,992.80 | Mex$4,550.64 | Mex$6,440.27 | 44 |
| Nov ’23 | Mex$4,508.59 | Mex$5,924.62 +31.4% | 11.0% | Mex$8,104.88 | Mex$5,028.57 | Mex$6,157.22 | 42 |
Analyst Forecast: Target price is more than 20% higher than the current share price and analysts are within a statistically confident range of agreement.
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