Is Microsoft Stock a Good Investment?

Microsoft Investment Advice

MSFT

To provide specific investment advice or recommendations on Microsoft stock, we recommend investors consider the following general factors when evaluating Microsoft. This will help you to make an informed decision on whether to include Microsoft in one of your diversified portfolios:

Examine Microsoft's financial health by looking at its balance sheet, income statement, and cash flow statement. Analyze key financial ratios, such as Price-to-Earnings (P/E), Price-to-Sales (P/S), and Price-to-Book (P/B), to determine whether the stock is fairly valued or over/undervalued.
Research Microsoft's leadership team and their track record. Good management can help Microsoft navigate difficult times and make strategic decisions that benefit shareholders and increases its net worth.
Consider the overall health of the Systems Software space and any emerging trends that could impact Microsoft's business and its evolving consumer preferences.
Compare Microsoft's performance and market position to its competitors. Analyze how Microsoft is positioned in terms of product offerings, innovation, and market share.
Check if Microsoft pays a dividend and its dividend yield and payout ratio.
Review what financial analysts are saying about Microsoft's stock and their price targets. However, remember that analysts' opinions can vary, and their predictions may not always be accurate.

It's important to note that investing in Microsoft stock, carries risks, and you should carefully consider your investment goals and risk tolerance before making any investment decisions. Also, remember that it's important for investors to have a long-term perspective and a well-diversified portfolio to manage the impact of stock market volatility on their investments. Below is a detailed guide on how to decide if Microsoft is a good investment.

Sell

Buy

Strong Hold

Macroaxis provides trade recommendations on Microsoft to complement and cross-verify current analyst consensus on Microsoft. Our advice engine determines the firm's potential to grow exclusively from the perspective of an investor's current risk tolerance and investing horizon. To make sure Microsoft is not overpriced, please verify all Microsoft fundamentals, including its shares owned by institutions, cash per share, number of employees, as well as the relationship between the revenue and cash flow from operations . Given that Microsoft has a price to earning of 26.64 X, we recommend you to check Microsoft market performance and probability of bankruptcy to ensure the company can sustain itself in the current economic cycle given your last-minute risk tolerance and investing horizon.

Market Performance	Very Weak	Details
Volatility	Very steady	Details
Hype Condition	Stale	Details
Current Valuation	Fairly Valued	Details
Odds Of Distress	Very Low	Details
Economic Sensitivity	Almost mirrors the market	Details
Investor Sentiment	Alarmed	Details
Analyst Consensus	Strong Buy	Details
Financial Strenth (F Score)	Strong	Details
Financial Leverage	Not Rated	Details
Reporting Quality (M-Score)	Unlikely Manipulator	Details

Examine Microsoft Stock

Researching Microsoft's stock involves analyzing various aspects of the company and its industry to make an informed investment decision. The key areas to focus on are fundamentals, business model and competitive advantage. It is also important to analyze trends in revenue, net income, and cash flow, as well as key financial ratios, such as price-to-earnings (P/E), price-to-sales (P/S), and debt-to-equity (D/E). About 74.0% of the company shares are owned by institutional investors. The company has Price/Earnings To Growth (PEG) ratio of 2.02. Microsoft recorded earning per share (EPS) of 11.06. The entity last dividend was issued on the 15th of May 2024. The firm had 2:1 split on the 18th of February 2003.

To determine if Microsoft is a good investment, evaluating the company's potential for future growth is also very important. This may include expanding into new markets, launching new products or services, or improving operational efficiency. Companies with strong growth prospects can be more attractive investments. This aspect of the research should be conducted in the context of the overall market and industry in which the company operates and should include an analysis of growth potential, competitive landscape, and any regulatory or economic factors that could impact the business. Some of the essential points regarding Microsoft's research are outlined below:

	Microsoft has a strong financial position based on the latest SEC filings
	About 74.0% of the company shares are owned by institutional investors
	On 14th of March 2024 Microsoft paid $ 0.75 per share dividend to its current shareholders
	Latest headline from seekingalpha.com: SP 500 notches worst week in over a year

Microsoft Quarterly Cost Of Revenue

19.62 Billion

Microsoft uses earnings reports to provide investors with an update of all three financial statements, including the income statement, the balance sheet, and the cash flow statement. Therefore, it is also crucial when considering investing in Microsoft. Every quarterly earnings report provides investors with an overview of sales, expenses, and net income for the most recent period. It also may provide a comparison to Microsoft's previous reporting period. The quarterly earnings reports are usually disseminated to the public via Form 10-Q, which is a legal document filed with the Securities and Exchange Commission every quarter.

	23rd of April 2024 Upcoming Quarterly Report	View
	23rd of July 2024 Next Financial Report	View
	31st of March 2024 Next Fiscal Quarter End	View
	23rd of July 2024 Next Fiscal Year End	View
	31st of December 2023 Last Quarter Report	View
	30th of June 2023 Last Financial Announcement	View

Earnings surprises can significantly impact Microsoft's stock price both in the short term and over time. Negative earnings surprises usually result in a price decline. However, it has been seen that positive earnings surprises lead to an immediate rise in a stock's price and a gradual increase over time. This is why we often hear news about some companies beating earning projections. Financial analysts spend a large amount of time predicting earnings per share (EPS) along with other important future indicators. Many analysts use forecasting models, management guidance, and additional fundamental information to derive an EPS estimate. Below are the table of largest EPS Surprises Microsoft's investors have experienced.

Reported	Fiscal Date	Estimated EPS	Reported EPS	Surprise
1998-01-21	1997-12-31	0.1	0.11	0.01	10
1997-01-17	1996-12-31	0.06	0.07	0.01	16
1996-04-18	1996-03-31	0.05	0.06	0.01	20
2001-10-18	2001-09-30	0.2	0.22	0.02	10
2000-04-20	2000-03-31	0.2	0.22	0.02	10
1999-10-19	1999-09-30	0.17	0.19	0.02	11
1999-07-19	1999-06-30	0.18	0.2	0.02	11
1998-10-20	1998-09-30	0.12	0.14	0.02	16

Know Microsoft's Top Institutional Investors

Have you ever been surprised when a price of an equity instrument such as Microsoft is soaring high without any particular reason? This is usually happening because many institutional investors are aggressively trading Microsoft backward and forwards among themselves. Microsoft's institutional investor refers to the entity that pools money to purchase Microsoft's securities or originate loans. Institutional investors include commercial and private banks, credit unions, insurance companies, pension funds, hedge funds, endowments, and mutual funds. Operating companies that invest excess capital in these types of assets may also be included in the term and may influence corporate governance by exercising voting rights in their investments.

		Shares
Capital Research & Mgmt Co - Division 3	2023-12-31	82.7 M
Capital Research Global Investors	2023-12-31	78.2 M
Northern Trust Corp	2023-12-31	77.8 M
Bank Of New York Mellon Corp	2023-12-31	68.1 M
Bank Of America Corp	2023-12-31	65.8 M
Wellington Management Company Llp	2023-12-31	62.1 M
Legal & General Group Plc	2023-12-31	61.8 M
Nuveen Asset Management, Llc	2023-12-31	53.1 M
Charles Schwab Investment Management Inc	2023-12-31	44.4 M
Vanguard Group Inc	2023-12-31	664.9 M
Blackrock Inc	2023-12-31	538.9 M

Note, although Microsoft's institutional investors appear to be way more sophisticated than retail investors, it remains unclear if professional active investment managers can reliably enhance risk-adjusted returns by an amount that exceeds fees and expenses.

Microsoft's market capitalization trends

The company currently falls under 'Mega-Cap' category with a current market capitalization of 2.98 T. Market capitalization usually refers to the total value of a company's stock within the entire market. To calculate Microsoft's market, we take the total number of its shares issued and multiply it by Microsoft's current market price. To manage market risk and economic uncertainty, many investors today build portfolios that are diversified across equities with different market capitalizations. However, as a general rule, conservative investors tend to hold large-cap stocks, and those looking for more risk prefer small-cap and mid-cap equities.

Market Cap

1.93 Trillion

Microsoft's profitablity analysis

Microsoft's profitability indicators refer to fundamental financial ratios that showcase Microsoft's ability to generate income relative to its revenue or operating costs. If, let's say, Microsoft is currently losing money, the management's focus should be on how to reverse that trend. However, when revenue exceeds expenses, Microsoft's executives or investors may be in less hurry to break that information down - which is where profitability analysis comes into play. Gaining a greater understanding of Microsoft's profitability requires more research than a typical breakdown of Microsoft's financial statements. By doing a profitability analysis, companies can identify areas needing attention, and investors can make a profitable trade.

	Last Reported	Projected for Next Year
Return On Tangible Assets	0.25	0.22
Return On Capital Employed	0.33	0.36
Return On Assets	0.18	0.20
Return On Equity	0.32	0.24

The company has Profit Margin (PM) of 0.36 %, which maeans that even a very small decline in it revenue will erase profits resulting in a net loss. This is way below average. Similarly, it shows Operating Margin (OM) of 0.44 %, which suggests for every 100 dollars of sales, it generated a net operating income of $0.44.

Determining Microsoft's profitability involves analyzing its financial statements and using various financial metrics to determine if Microsoft is a good buy. For example, gross profit margin measures Microsoft's profitability after accounting for the cost of goods sold, while net profit margin measures profitability after accounting for all expenses. Other important metrics include return on assets, return on equity, and free cash flow. By reviewing multiple sources and metrics, you can gain a complete picture of Microsoft's profitability and make more informed investment decisions.

The data published in Microsoft's official financial statements usually reflect Microsoft's business processes, product offerings, services, and other fundamental events. But there are other numbers, ratios, or fundamental indicators derived from these statements that are easier to understand and visualize within the underlying realities that drive quantitative information of Microsoft. For example, before you start analyzing numbers published by Microsoft accountants, it's critical to develop an understanding of what Microsoft's liquidity, profitability, and earnings quality are in the context of the Software space in which it operates.

Please note, the presentation of Microsoft's financial position, as portrayed in its financial statements, is often influenced by management's estimates, judgments, and sometimes even manipulations. In the best case, Microsoft's management is honest, while the outside auditors are strict and uncompromising. Whatever the case, the imprecision that can be found in Microsoft's accounting process means that the reasonable investor should take a skeptical approach toward the financial statement analysis of Microsoft. Please utilize our Beneish M Score to check the likelihood of Microsoft's management manipulating its earnings.

Evaluate Microsoft's management efficiency

Microsoft has return on total asset (ROA) of 0.1519 % which means that it generated a profit of $0.1519 on every $100 spent on assets. This is way below average. Similarly, it shows a return on stockholder's equity (ROE) of 0.3917 %, meaning that it created $0.3917 on every $100 dollars invested by stockholders. Microsoft's management efficiency ratios could be used to measure how well Microsoft manages its routine affairs as well as how well it operates its assets and liabilities. At this time, Microsoft's Return On Capital Employed is comparatively stable compared to the past year. Return On Assets is likely to gain to 0.20 in 2024, whereas Return On Tangible Assets are likely to drop 0.22 in 2024. At this time, Microsoft's Total Current Liabilities is comparatively stable compared to the past year. Liabilities And Stockholders Equity is likely to gain to about 497.5 B in 2024, whereas Change To Liabilities is likely to drop slightly above 6.9 B in 2024.

	Last Reported	Projected for Next Year
Book Value Per Share	24.93	26.17
Net Current Asset Value	0.00	0.00
Tangible Asset Value	0.00	0.00
Tangible Book Value Per Share	15.59	16.37
Enterprise Value Over EBITDA	28.01	21.25
Price Book Value Ratio	14.14	9.01
Enterprise Value Multiple	28.01	21.25
Price Fair Value	14.14	9.01
Enterprise Value	1.9 T	2 T

The analysis of Microsoft's management efficiency is an essential part of evaluating and assessing the financial and operational performance of the entity. It is also vital to analyze Microsoft's future growth prospects and the overall market conditions to determine the value and potential of its stock. The analysis involves studying a range of financial metrics such as revenue, earnings, profit margins, cash flow, debt, market share, and external factors such as economic trends, industry outlook, competition, and government regulations. The goal of Microsoft Stock analysis is to determine whether it is undervalued, fairly valued, or overvalued and to make informed investment decisions.

Dividend Yield

0.0075

Forward Dividend Yield

0.0075

Forward Dividend Rate

Beta

0.877

Basic technical analysis of Microsoft Stock

As of the 23rd of April, Microsoft secures the Risk Adjusted Performance of 0.0237, downside deviation of 1.13, and Mean Deviation of 0.9379. In connection with fundamental indicators, the technical analysis model lets you check existing technical drivers of Microsoft, as well as the relationship between them. Strictly speaking, you can use this information to find out if the firm will indeed mirror its model of past prices, or the prices will eventually revert. We were able to analyze and collect data for nineteen technical drivers for Microsoft, which can be compared to its peers in the industry. Please verify Microsoft variance, as well as the relationship between the value at risk and skewness to decide if Microsoft is priced some-what accurately, providing market reflects its recent price of 400.96 per share. Given that Microsoft has jensen alpha of (0.05), we recommend you to check Microsoft's last-minute market performance to make sure the company can sustain itself at a future point.

Microsoft's insider trading activities

Some recent studies suggest that insider trading raises the cost of capital for securities issuers and decreases overall economic growth. Trading by specific Microsoft insiders, such as employees or executives, is commonly permitted as long as it does not rely on Microsoft's material information that is not in the public domain. Local jurisdictions usually require such trading to be reported in order to monitor insider transactions. In many U.S. states, trading conducted by corporate officers, key employees, directors, or significant shareholders must be reported to the regulator or publicly disclosed, usually within a few business days of the trade. In these cases Microsoft insiders are required to file a Form 4 with the U.S. Securities and Exchange Commission (SEC) when buying or selling shares of their own companies.

		Christopher Young over three months ago Payment of 10302 shares by Christopher Young of Microsoft subject to Rule 16b-3
		Padmasree Warrior over six months ago Acquisition by Padmasree Warrior of 175 shares of Microsoft subject to Rule 16b-3

Microsoft's Outstanding Corporate Bonds

Microsoft issues bonds to finance its operations. Corporate bonds make up one of the largest components of the U.S. bond market, which is considered the world's largest securities market. Microsoft uses the proceeds from bond sales for a wide variety of purposes, including financing ongoing mergers and acquisitions, buying new equipment, investing in research and development, buying back their own stock, paying dividends to shareholders, and even refinancing existing debt. Most Microsoft bonds can be classified according to their maturity, which is the date when Microsoft has to pay back the principal to investors. Maturities can be short-term, medium-term, or long-term (more than ten years). Longer-term bonds usually offer higher interest rates but may entail additional risks.

	MICROSOFT P 35 Corp Bond US594918AR51	View
	MICROSOFT P 375 Corp Bond US594918AU80	View
	MICROSOFT P 45 Corp Bond US594918AJ36	View
	MICROSOFT P 53 Corp Bond US594918AM64	View
	MICROSOFT P 27 Corp Bond US594918BB90	View
	MICROSOFT P 375 Corp Bond US594918BD56	View
	MICROSOFT P 35 Corp Bond US594918BC73	View
	MICROSOFT P 4 Corp Bond US594918BE30	View

View All Microsoft Corporate Bonds

Understand Microsoft's technical and predictive indicators

Using predictive indicators to make investment decisions involves analyzing Microsoft's various financial and market-based factors to help forecast future trends and identify investment opportunities. Select the indicators that are most relevant to your investment strategy. Each indicator has its own strengths and weaknesses, so it's essential to combine multiple indicators to get a more comprehensive view of the market and reduce the risk of making poor decisions based on limited data.

	Risk Adjusted Performance	0.0237
	Market Risk Adjusted Performance	0.0365
	Mean Deviation	0.9379
	Semi Deviation	1.08
	Downside Deviation	1.13
	Coefficient Of Variation	3284.31
	Standard Deviation	1.22
	Variance	1.49
	Information Ratio	(0.04)
	Jensen Alpha	(0.05)
	Total Risk Alpha	(0.13)
	Sortino Ratio	(0.05)
	Treynor Ratio	0.0265
	Maximum Drawdown	5.31
	Value At Risk	(2.07)
	Potential Upside	2.11
	Downside Variance	1.27
	Semi Variance	1.17
	Expected Short fall	(1.14)
	Skewness	(0.07)
	Kurtosis	(0.03)

	Risk Adjusted Performance	0.0237
	Market Risk Adjusted Performance	0.0365
	Mean Deviation	0.9379
	Semi Deviation	1.08
	Downside Deviation	1.13
	Coefficient Of Variation	3284.31
	Standard Deviation	1.22
	Variance	1.49
	Information Ratio	(0.04)
	Jensen Alpha	(0.05)
	Total Risk Alpha	(0.13)
	Sortino Ratio	(0.05)
	Treynor Ratio	0.0265
	Maximum Drawdown	5.31
	Value At Risk	(2.07)
	Potential Upside	2.11
	Downside Variance	1.27
	Semi Variance	1.17
	Expected Short fall	(1.14)
	Skewness	(0.07)
	Kurtosis	(0.03)

Consider Microsoft's intraday indicators

Microsoft intraday indicators are useful technical analysis tools used by many experienced traders. Just like the conventional technical analysis, daily indicators help intraday investors to analyze the price movement with the timing of Microsoft stock daily movement. By combining multiple daily indicators into a single trading strategy, you can limit your risk while still earning strong returns on your managed positions.

	Accumulation Distribution	0.0176
	Daily Balance Of Power	0.2595
	Rate Of Daily Change	1.0
	Day Median Price	399.29
	Day Typical Price	399.85
	Market Facilitation Index	7.09
	Price Action Indicator	2.58
	Period Momentum Indicator	1.84

Microsoft Corporate Filings

F4	16th of April 2024 The report filed by a party regarding the acquisition or disposition of a company's common stock, as well as derivative securities such as options, warrants, and convertible securities	View Verify
	21st of March 2024 Other Reports	View Verify
8K	8th of March 2024 An amendment to a previously filed Form 8-K	View Verify
13A	13th of February 2024 An amended filing to the original Schedule 13G	View Verify

Microsoft time-series forecasting models is one of many Microsoft's stock analysis techniques aimed to predict future share value based on previously observed values. Time-series forecasting models ae widely used for non-stationary data. Non-stationary data are called the data whose statistical properties e.g. the mean and standard deviation are not constant over time but instead, these metrics vary over time. These non-stationary Microsoft's historical data is usually called time-series. Some empirical experimentation suggests that the statistical forecasting models outperform the models based exclusively on fundamental analysis to predict the direction of the market movement and maximize returns from investment trading.

Microsoft Stock media impact

Far too much social signal, news, headlines, and media speculation about Microsoft that are available to investors today. That information is available publicly through Microsoft media outlets and privately through word of mouth or via Microsoft internal channels. However, regardless of the origin, that massive amount of Microsoft data is challenging to quantify into actionable patterns, especially for investors that are not very sophisticated with ever-evolving tools and techniques used in the investment management field.

A primary focus of Microsoft news analysis is to determine if its current price reflects all relevant headlines and social signals impacting the current market conditions. A news analyst typically looks at the history of Microsoft relative headlines and hype rather than examining external drivers such as technical or fundamental data. It is believed that price action tends to repeat itself due to investors' collective, patterned thinking related to Microsoft's headlines and news coverage data. This data is often completely overlooked or insufficiently analyzed for actionable insights to drive Microsoft alpha.

Microsoft Sentiment by Major News Outlets

Investor sentiment, mood or attitude towards Microsoft can have a significant impact on its stock price or the market as a whole. This sentiment can be positive or negative, and various factors, such as economic indicators, news events, or market trends, can influence it. When investor sentiment is positive, investors are more likely to buy stocks, increasing demand and increasing the stock price. Positive investor sentiment can be driven by good news about the company or the broader market, such as solid earnings reports or positive economic data.

Note that negative investor sentiment can cause investors to sell stocks, leading to a decrease in demand and a drop in the stock price. Negative sentiment can be driven by factors such as poor earnings reports, negative news about the company or industry, or broader economic concerns. It's important to note that investor sentiment is just one of many factors that can affect stock prices. Other factors, such as company performance, industry trends, and global economic conditions, can also play a significant role in determining the value of a stock.

Microsoft Historical Investor Sentiment

Investor biases related to Microsoft's public news can be used to forecast risks associated with an investment in Microsoft. The trend in average sentiment can be used to explain how an investor holding Microsoft can time the market purely based on public headlines and social activities around Microsoft. Please note that most equities that are difficult to arbitrage are affected by market sentiment the most.

Microsoft's market sentiment shows the aggregated news analyzed to detect positive and negative mentions from the text and comments. The data is normalized to provide daily scores for Microsoft and other traded tickers. The bigger the bubble, the more accurate the estimated score. Higher bars for a given day show more participation in the average Microsoft news discussions. The higher the estimate score, the more favorable the investor's outlook on Microsoft.

Microsoft Maximum Pain Price across 2024-04-26 Option Contracts

Microsoft's options can also be used to analyze investors' bias and current market sentiment in the context of behavioral finance. For example, Max pain usually refers to a trading concept that asserts that market manipulation can cause the market price of Microsoft close to the expiration of its current option contract to expire worthlessly. According to most research, about 35% of options are not executed, with roughly 50% traded out before expiration. So, Max pain occurs when market makers reach a net favorable position across all options at a strike price where option holders stand to lose the most money. By contrast, option sellers may reap the most after selling more options than buying, causing them to expire worthlessly. Please continue to view the detailed analysis of Microsoft's options.

Be your own money manager

Our tools can tell you how much better you can do entering a position in Microsoft without increasing your portfolio risk or giving up the expected return. As an individual investor, you need to find a reliable way to track all your investment portfolios. However, your requirements will often be based on how much of the process you decide to do yourself. In addition to allowing all investors analytical transparency into all their portfolios, our tools can evaluate risk-adjusted returns of your individual positions relative to your overall portfolio.

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Microsoft Corporate Directors

Microsoft corporate directors refer to members of a Microsoft board of directors. The board of directors generally takes responsibility for the Microsoft's affairs and long-term direction of the entity. A corporate director does not make decisions for the corporation on his own. As a member of the board of directors, she or he must function as a part of a group that makes decisions on behalf of the business only by the board of directors' meetings. To pass a resolution, a majority of Microsoft's board members must vote for the resolution. The Microsoft board of directors' duties also include the election, removal, and supervision of officers, including the adoption, amendment, and repeal of bylaws.

Charles Scharf	Director	Profile
Helmut Panke	Independent Director	Profile
Penny Pritzker	Independent Director	Profile
Sandra Peterson	Independent Director	Profile

How to buy Microsoft Stock?

Examine Microsoft's financial health by looking at its balance sheet, income statement, and cash flow statement. Analyze key financial ratios, such as Price-to-Earnings (P/E), Price-to-Sales (P/S), and Price-to-Book (P/B), to determine whether the stock is fairly valued or over/undervalued.
Research Microsoft's leadership team and their track record. Good management can help Microsoft navigate difficult times and make strategic decisions that benefit shareholders and increases its net worth.
Consider the overall health of the Systems Software space and any emerging trends that could impact Microsoft's business and its evolving consumer preferences.
Compare Microsoft's performance and market position to its competitors. Analyze how Microsoft is positioned in terms of product offerings, innovation, and market share.
Check if Microsoft pays a dividend and its dividend yield and payout ratio.
Review what financial analysts are saying about Microsoft's stock and their price targets. However, remember that analysts' opinions can vary, and their predictions may not always be accurate.

Already Invested in Microsoft?

The danger of trading Microsoft is mainly related to its market volatility and Company specific events. As an investor, you must understand the concept of risk-adjusted return before you start trading. The most common way to measure the risk of Microsoft is by using the Sharpe ratio. The ratio expresses how much excess return you acquire for the extra volatility you endure for holding a more risker asset than Microsoft. The Sharpe ratio is calculated by using standard deviation and excess return to determine reward per unit of risk. To understand how volatile Microsoft is, you must compare it to a benchmark. Traditionally, the risk-free rate of return is the rate of return on the shortest-dated U.S. Treasury, such as a 3-year bond.

When determining whether Microsoft is a good investment, qualitative aspects like company management, corporate governance, and ethical practices play a significant role. A comparison with peer companies also provides context and helps to understand if Microsoft Stock is undervalued or overvalued. This multi-faceted approach, blending both quantitative and qualitative analysis, forms a solid foundation for making an informed investment decision about Microsoft Stock. Highlighted below are key reports to facilitate an investment decision about Microsoft Stock: