NasdaqGS:MSFT

Stock Analysis Report

Executive Summary

Microsoft Corporation develops, licenses, and supports software, services, devices, and solutions worldwide.

Snowflake

Fundamentals

Solid track record established dividend payer.


Similar Companies

Share Price & News

How has Microsoft's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

1.8%

MSFT

1.5%

US Software

1.3%

US Market


1 Year Return

29.7%

MSFT

23.1%

US Software

5.9%

US Market

Return vs Industry: MSFT exceeded the US Software industry which returned 23.1% over the past year.

Return vs Market: MSFT exceeded the US Market which returned 5.9% over the past year.


Shareholder returns

MSFTIndustryMarket
7 Day1.8%1.5%1.3%
30 Day1.6%-0.8%-1.9%
90 Day1.8%-3.4%-1.8%
1 Year31.7%29.7%24.8%23.1%8.3%5.9%
3 Year158.3%143.9%122.8%114.1%45.6%36.2%
5 Year253.7%216.6%179.3%159.1%66.1%47.9%

Price Volatility Vs. Market

How volatile is Microsoft's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Microsoft undervalued compared to its fair value and its price relative to the market?

27.29x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Undervalued: MSFT ($139.55) is trading above our estimate of fair value ($106.44)

Significantly Undervalued: MSFT is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: MSFT is good value based on its PE Ratio (27.3x) compared to the Software industry average (48.2x).

PE vs Market: MSFT is poor value based on its PE Ratio (27.3x) compared to the US market (17.5x).


Price to Earnings Growth Ratio

Low PEG Ratio: MSFT is poor value based on its PEG Ratio (3.1x)


Price to Book Ratio

PB vs Industry: MSFT is overvalued based on its PB Ratio (10.4x) compared to the US Software industry average (5.1x).


Next Steps

Future Growth

How is Microsoft forecast to perform in the next 1 to 3 years based on estimates from 30 analysts?

8.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: MSFT's forecast earnings growth (8.8% per year) is above the savings rate (2.7%).

Earnings vs Market: MSFT's earnings (8.8% per year) are forecast to grow slower than the US market (14.4% per year).

High Growth Earnings: MSFT's earnings are forecast to grow, but not significantly.

Revenue vs Market: MSFT's revenue (9.5% per year) is forecast to grow faster than the US market (7.3% per year).

High Growth Revenue: MSFT's revenue (9.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: MSFT's Return on Equity is forecast to be high in 3 years time (35.1%)


Next Steps

Past Performance

How has Microsoft performed over the past 5 years?

12.6%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: MSFT's earnings have grown by 12.6% per year over the past 5 years.

Accelerating Growth: MSFT's earnings growth over the past year (136.8%) exceeds its 5-year average (12.6% per year).

Earnings vs Industry: MSFT earnings growth over the past year (136.8%) exceeded the Software industry 19.1%.


Return on Equity

High ROE: MSFT's Return on Equity (38.3%) is considered high.


Return on Assets

ROA vs Industry: MSFT has a higher Return on Assets than the Software industry average last year.


Return on Capital Employed

ROCE Improving: MSFT's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Microsoft's financial position?


Financial Position Analysis

Short Term Liabilities: MSFT's short term assets ($175.6B) exceeds its short term liabilities ($69.4B)

Long Term Liabilities: MSFT's short term assets (175.6B) exceeds its long term liabilities (114.8B)


Debt to Equity History and Analysis

Debt Level: MSFT's debt to equity ratio (70.5%) is considered high

Reducing Debt: MSFT's debt to equity ratio has increased from 25.9% to 70.5% over the past 5 years.

Debt Coverage: MSFT's debt is well covered by operating cash flow (72.3%).

Interest Coverage: MSFT earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: MSFT has a low level of unsold assets or inventory.

Debt Coverage by Assets: MSFT's debt is covered by short term assets (assets are 2.432200x debt).


Next Steps

Dividend

What is Microsoft's current dividend yield, its reliability and sustainability?

1.46%

Current Dividend Yield


Upcoming Dividend Payment

Purchase Microsoft before the 'Buy Limit' to receive their next dividend payment.


Dividend Yield vs Market

company1.5%marketbottom25%1.5%markettop25%3.8%industryaverage1.5%forecastin3Years1.5%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: MSFT's dividend (1.46%) is higher than the bottom 25% of dividend payers in the US market (1.47%).

High Dividend: MSFT's dividend (1.46%) is low compared to the top 25% of dividend payers in the US market (3.77%).

Stable Dividend: MSFT's dividends per share have been stable in the past 10 years.

Growing Dividend: MSFT's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (36%), MSFT's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: MSFT's dividends in 3 years are forecast to be well covered by earnings (36% payout ratio).


Next Steps

Management

What is the CEO of Microsoft's salary, the management and board of directors tenure and is there insider trading?

4.1yrs

Average management tenure


CEO

Satya Nadella (52yo)

5.7yrs

Tenure

US$25,843,263

Compensation

Mr. Satya Nadella is Chief Executive Officer and Director of Microsoft Corporation since February 2014. Before being named CEO in February 2014, he held leadership roles in both enterprise and consumer bus ...


CEO Compensation Analysis

Compensation vs. Market: Satya's total compensation ($USD25.84M) is about average for companies of similar size in the US market ($USD11.20M).

Compensation vs Earnings: Satya's compensation has increased by more than 20% in the past year.


Management Age and Tenure

4.1yrs

Average Tenure

57.5yo

Average Age

Experienced Management: MSFT's management team is considered experienced (4.1 years average tenure).


Board Age and Tenure

5.5yrs

Average Tenure

62yo

Average Age

Experienced Board: MSFT's board of directors are considered experienced (5.5 years average tenure).


Insider Trading

Insider Buying: MSFT insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$1,220,21711 Sep 19
Christopher Capossela
EntityIndividual
Shares9,000
Max PriceUS$135.58
SellUS$5,409,97211 Sep 19
Kathleen Hogan
EntityIndividual
Shares40,000
Max PriceUS$135.25
SellUS$2,588,61606 Sep 19
Christopher Capossela
EntityIndividual
Shares18,500
Max PriceUS$140.10
SellUS$16,988,65705 Sep 19
Amy Hood
EntityIndividual
Role
Chief Financial Officer
Executive VP & CFO
Shares123,769
Max PriceUS$137.26
SellUS$1,649,06005 Sep 19
Jean-Philippe Courtois
EntityIndividual
Role
Chief Operating Officer
Executive VP and President of Microsoft Global Sales
Shares11,779
Max PriceUS$140.00
SellUS$1,741,93805 Sep 19
Christopher Capossela
EntityIndividual
Shares12,500
Max PriceUS$139.36
SellUS$967,05014 Aug 19
Christopher Capossela
EntityIndividual
Shares7,000
Max PriceUS$138.15
SellUS$483,00612 Aug 19
Christopher Capossela
EntityIndividual
Shares3,500
Max PriceUS$138.00
SellUS$465,54205 Aug 19
Christopher Capossela
EntityIndividual
Shares3,372
Max PriceUS$138.06
SellUS$564,21630 Jul 19
Frank Brod
EntityIndividual
Role
Chief Accounting Officer
Corporate VP of Finance & Administration and Chief Accounting Officer
Shares4,000
Max PriceUS$141.05
SellUS$2,123,65411 Jun 19
Kathleen Hogan
EntityIndividual
Shares15,947
Max PriceUS$133.17
SellUS$630,09915 May 19
Christopher Capossela
EntityIndividual
Shares5,000
Max PriceUS$126.34
SellUS$386,62007 May 19
Christopher Capossela
EntityIndividual
Shares3,000
Max PriceUS$128.87
SellUS$25,064,20902 May 19
Bradford Smith
EntityIndividual
Role
President
President & Chief Legal Officer
Shares192,300
Max PriceUS$130.34
SellUS$1,170,54311 Mar 19
Christopher Capossela
EntityIndividual
Shares10,500
Max PriceUS$112.41
SellUS$3,043,75719 Feb 19
Jean-Philippe Courtois
EntityIndividual
Role
Chief Operating Officer
Executive VP and President of Microsoft Global Sales
Shares28,147
Max PriceUS$108.14
SellUS$422,00011 Dec 18
Christopher Capossela
EntityIndividual
Shares4,000
Max PriceUS$105.50
SellUS$432,00007 Dec 18
Christopher Capossela
EntityIndividual
Shares4,000
Max PriceUS$108.00
SellUS$1,117,66005 Dec 18
Christopher Capossela
EntityIndividual
Shares10,000
Max PriceUS$111.77
SellUS$4,061,86609 Nov 18
Kathleen Hogan
EntityIndividual
Shares36,500
Max PriceUS$111.28
SellUS$214,36306 Nov 18
Frank Brod
EntityIndividual
Role
Chief Accounting Officer
Corporate VP of Finance & Administration and Chief Accounting Officer
Shares2,000
Max PriceUS$107.18
SellUS$2,153,90001 Nov 18
Frank Brod
EntityIndividual
Role
Chief Accounting Officer
Corporate VP of Finance & Administration and Chief Accounting Officer
Shares20,000
Max PriceUS$107.70

Ownership Breakdown


Management Team

  • Frank Brod (64yo)

    Corporate VP of Finance & Administration and Chief Accounting Officer

    • Tenure: 0yrs
  • Bill Gates (64yo)

    Co-Founder

    • Tenure: 38.8yrs
  • Jean-Philippe Courtois (58yo)

    Executive VP and President of Microsoft Global Sales

    • Tenure: 3.3yrs
    • Compensation: US$11.13m
  • Satya Nadella (52yo)

    CEO & Director

    • Tenure: 5.7yrs
    • Compensation: US$25.84m
  • Brad Smith (60yo)

    President & Chief Legal Officer

    • Tenure: 4.1yrs
    • Compensation: US$13.51m
  • Peggy Johnson (57yo)

    Executive Vice President of Business Development

    • Tenure: 5.1yrs
    • Compensation: US$8.76m
  • Amy Hood (47yo)

    Executive VP & CFO

    • Tenure: 6.4yrs
    • Compensation: US$14.92m
  • J. Scott (46yo)

    CTO & Executive VP

    • Tenure: 2.8yrs
  • Vikas Mehta

    Director of Investor Relations

    • Tenure: 0yrs
  • Nick Coleman

    Chief Technology Officer

    • Tenure: 1yrs

Board Members

  • Charlie Scharf (54yo)

    Independent Director

    • Tenure: 5yrs
    • Compensation: US$325.00k
  • Bill Gates (64yo)

    Co-Founder

    • Tenure: 38.8yrs
  • John Thompson (70yo)

    Independent Chairman

    • Tenure: 5.7yrs
    • Compensation: US$690.00k
  • Chuck Noski (66yo)

    Independent Director

    • Tenure: 15.9yrs
    • Compensation: US$370.00k
  • John Stanton (64yo)

    Independent Director

    • Tenure: 5.3yrs
    • Compensation: US$355.00k
  • Sandi Peterson (60yo)

    Independent Director

    • Tenure: 3.8yrs
    • Compensation: US$355.00k
  • Helmut Gunter Panke (73yo)

    Independent Director

    • Tenure: 15.9yrs
    • Compensation: US$357.50k
  • Satya Nadella (52yo)

    CEO & Director

    • Tenure: 5.7yrs
    • Compensation: US$25.84m
  • Padmasree Warrior (58yo)

    Independent Director

    • Tenure: 3.8yrs
    • Compensation: US$325.00k
  • Teri List-Stoll (56yo)

    Director

    • Tenure: 5yrs
    • Compensation: US$355.00k

Company Information

Microsoft Corporation's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Microsoft Corporation
  • Ticker: MSFT
  • Exchange: NasdaqGS
  • Founded: 1975
  • Industry: Systems Software
  • Sector: Software
  • Market Cap: US$1.066t
  • Shares outstanding: 7.64b
  • Website: https://www.microsoft.com

Number of Employees


Location

  • Microsoft Corporation
  • One Microsoft Way
  • Redmond
  • Washington
  • 98052
  • United States

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
MSFXTRA (XETRA Trading Platform)YesCommon StockDEEURMar 1986
MSFTNasdaqGS (Nasdaq Global Select)YesCommon StockUSUSDMar 1986
MSFT *BMV (Bolsa Mexicana de Valores)YesCommon StockMXMXNMar 1986
MSFDB (Deutsche Boerse AG)YesCommon StockDEEURMar 1986
4338SEHK (The Stock Exchange of Hong Kong Ltd.)YesCommon StockHKHKDMar 1986
MSFTSWX (SIX Swiss Exchange)YesCommon StockCHCHFMar 1986
MSFENXTBR (Euronext Brussels)YesCommon StockBEUSDMar 1986
MSFTWBAG (Wiener Boerse AG)YesCommon StockATEURMar 1986
MSFTBVC (Bolsa de Valores de Colombia)YesCommon StockCOCOPMar 1986
MSFTSNSE (Santiago Stock Exchange)YesCommon StockCLUSDMar 1986
US_MSFTKAS (Kazakhstan Stock Exchange)YesCommon StockKZKZTMar 1986
MSFTBASE (Buenos Aires Stock Exchange)CEDEARS EACH REP 1/5 ORD USD0.000025ARARSDec 1999
MSFT34BOVESPA (Bolsa de Valores de Sao Paulo)BDR EACH REPR 1 COM SHSBRBRLDec 2011

Biography

Microsoft Corporation develops, licenses, and supports software, services, devices, and solutions worldwide. The company’s Productivity and Business Processes segment offers Office, Exchange, SharePoint, M ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/14 23:38
End of Day Share Price2019/10/14 00:00
Earnings2019/06/30
Annual Earnings2019/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.