Microsoft Stock Valuation

MSFT -  USA Stock  

USD 304.21  1.46  0.48%

What would the acquisition value of Microsoft Corp be today? Calculating the true value of any business is not as easy as it may seem. While the market cap of a public entity, such as Microsoft Corp, is its stock price multiplied by the total number of shares outstanding, calculating Microsoft Corp's enterprise value requires a different approach. It uses Microsoft Corp's balance sheet items such as long-term debt, the book value of the preferred stock, minority interest, and other important financials.
Enterprise Value is likely to gain to about 2138.7 B in 2021, whereas Free Cash Flow is likely to drop slightly above 48.4 B in 2021.
Microsoft Corp secures a last-minute Real Value of $331.59 per share. The latest price of the firm is $304.21. At this time, the firm appears to be undervalued. Our model forecasts the value of Microsoft Corp from analyzing the firm fundamentals such as Current Valuation of 2170 B, profit margin of 36.45 %, and Return On Equity of 47.08 % as well as examining its technical indicators and Probability Of Bankruptcy. In general, we recommend acquiring undervalued stocks and selling overvalued stocks since, at some point, asset prices and their ongoing real values will merge together.

Microsoft Valuation 

 
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Microsoft Corp Valuation Module provides a unique way to ballpark how much the company is worth today. It is done using both, our quantitative analysis of the company fundamentals as well as its intrinsic market price estimation to project the real value. We also take into consideration other essential factors such as Microsoft Corp's management style, its c-level domain expertise and tenure, its overall leadership history as well as current capital structure, and future earnings potential.
Undervalued
Today
304.21
17th of October 2021
Share
Please note that Microsoft Corp's price fluctuation is very steady at this time. Calculation of the real value of Microsoft Corp is based on 3 months time horizon. Increasing Microsoft Corp's time horizon generally increases the accuracy of value calculation and significantly improves the predictive power of the methodology used.
Our valuation method for Microsoft Corp is useful when determining the fair value of the Microsoft stock, which is usually determined by what a typical buyer is willing to pay for full or partial control of Microsoft Corp. Since Microsoft Corp is currently traded on the exchange, buyers and sellers on that exchange determine the market value of Microsoft Stock. However, Microsoft Corp's intrinsic value may or may not be the same as its current market price, in which case there is an opportunity to profit from the mispricing, assuming the market price will eventually merge with its intrinsic value.
273.79
Downside
331.59
Real Value
332.70
Upside
Estimating the potential upside or downside of Microsoft Corp helps investors to forecast how Microsoft stock's addition to their portfolios will impact the overall performance. We also use other valuation drivers to help us estimate the true value of Microsoft Corp more accurately as focusing exclusively on Microsoft Corp's fundamentals will not take into account other important factors:
Earnings
Estimates (14)
LowProjected EPSHigh
8.128.648.95
Details
Hype
Prediction
LowEstimated ValueHigh
303.22304.33305.44
Details
20 Analysts
Consensus
LowTarget PriceHigh
220.00322.42411.00
Details
Traditionally analysts and sophisticated investors use multiple methods for valuing a cash-flow-generating entity or its stock. For example, some money managers use Microsoft Corp's intrinsic value based on its ongoing forecasts of Microsoft Corp's financial statements. In contrast, other private, professional wealth advisors use a multiplier approach by looking to relative value analysis against Microsoft Corp's closest peers. When choosing an evaluation method for Microsoft Corp, ensure it is appropriate for the firm given its current financial situation and market classification. If more than one evaluation category is relevant, we suggest using both methods to arrive at a better estimate.

Microsoft Corp Investments

6.52 BillionShare

Microsoft Valuation Drivers Correlation

Many accounts on the financial statements of Microsoft Corp are highly interrelated and sometimes correlated. Consequently, when conducting Microsoft's valuation analysis, one should examine all of the accounts reported to obtain a complete picture of its financial situation. We provide a unique feature to present a conventional correlation table purposely composed against different valuation-related drivers of Microsoft
Click cells to compare fundamentals

Microsoft Valuation Trend

Knowing Microsoft Corp's actual value is paramount for traders to make sound investment determinations. Microsoft Corp's real value is not only important for the investor to make better decisions but also for a more accurate overall view of Microsoft Corp's financial worth over time since having this information enables investors and analysts to forecast the earnings more efficiently. Using both Microsoft Corp's enterprise value as well as its market capitalization is the best way to gauging the value of the company and is usually enough for investors to make market timing descisions.

Microsoft Market Cap

Microsoft Corp is considered to be number one stock in market capitalization category among related companies. Market capitalization of Software—Infrastructure industry is now estimated at about 2.34 Trillion. Microsoft Corp totals roughly 2.28 Trillion in market capitalization claiming about 98% of equities listed under Software—Infrastructure industry.
Capitalization  Workforce  Total debt  Valuation  Revenue

Microsoft Corp Valuation Ratios as Compared to Competition

Comparative valuation techniques use various fundamental indicators to help in determining Microsoft Corp's current stock value. Our valuation model uses many indicators to compare Microsoft Corp value to that of its competitors to determine the firm's financial worth. You can analyze the relationship between different fundamental ratios across Microsoft Corp competition to find correlations between indicators driving Microsoft Corp's intrinsic value. More Info.
Microsoft Corp is regarded second in price to earning category among related companies. It is regarded second in price to sales category among related companies fabricating about  0.33  of Price to Sales per Price to Earning. The ratio of Price to Earning to Price to Sales for Microsoft Corp is roughly  3.04 . Price to Sales Ratio is likely to drop to 9.89 in 2021

About Microsoft Corp Valuation

The equity valuation mechanism determines the current worth of Microsoft Corp on a weekly basis. We use both absolute as well as relative valuation methodologies to arrive at the intrinsic value of Microsoft Corp. In general, an absolute valuation paradigm, as applied to this company, attempts to find the value of Microsoft Corp based exclusively on its fundamental and basic technical indicators. By analyzing Microsoft Corp's financials, quarterly and monthly indicators, and its related drivers such as dividends, operating cash flow, and various types of growth rates, we attempt to find the most accurate representation of Microsoft Corp's intrinsic value. In some cases, mostly for established, large-cap companies, we also incorporate more traditional valuation methods such as dividend discount, discounted cash flow, or asset-based models. As compared to an absolute model, our relative valuation model uses a comparative analysis of Microsoft Corp. We calculate exposure to Microsoft Corp's market risk, different technical and fundamental indicators, relevant financial multiples and ratios, and then comparing them to Microsoft Corp's related companies.
Last ReportedProjected for 2021
Gross Profit115.9 B101.9 B
Profit Margin 0.36  0.34 
Microsoft Corporation develops, licenses, and supports software, services, devices, and solutions worldwide. Microsoft Corporation was founded in 1975 and is headquartered in Redmond, Washington. Microsoft Corp operates under SoftwareInfrastructure classification in the United States and is traded on NASDAQ Exchange. It employs 181000 people.

Microsoft Corp Quarterly Enterprise Value

1.98 TrillionShare

Microsoft Corp Dividends Analysis For Valuation

Dividend Yield is likely to gain to 0.008211 in 2021, whereas Payment of Dividends and Other Cash Distributions is likely to drop (17.8 B) in 2021. . Microsoft Corp Accumulated Retained Earnings Deficit are comparatively stable at the moment as compared to the past year. Microsoft Corp reported Accumulated Retained Earnings Deficit of 57.05 Billion in 2020. Earnings per Basic Share is likely to gain to 8.76 in 2021, whereas Earnings Before Interest Taxes and Depreciation Amortization EBITDA are likely to drop slightly above 68.1 B in 2021.
Last ReportedProjected for 2021
Payment of Dividends and Other Cash Distributions-16.5 B-17.8 B
Dividend Yield 0.008  0.008211 
Dividends per Basic Common Share 2.19  1.95 
There are various types of dividends Microsoft Corp can pay to its shareholders, and the actual value of the dividend is determined on a per-share basis. It is to be paid equally to all of Microsoft shareholders on a specific date, known as the payable date. The cash dividend is the most common type of dividend payment - it is the payment of actual cash from Microsoft Corp directly to its shareholders. There are other types of dividends that companies can issue, such as stock dividends or asset dividends. When Microsoft pays a dividend, it has no impact on its enterprise value. It does, however, lowers the Equity Value of Microsoft Corp by the value of the dividends paid out.

Microsoft Corp Valuation Growth Rates

Growth stocks usually refer to those companies expected to grow sales and earnings faster than the market average. Growth stocks typically don't pay dividends, often look expensive, and usually trading at a high P/E ratio. Nevertheless, such valuations could be relatively cheap if the company continues to grow, which will drive the share price up. However, since most investors are paying a high price for a growth stock, based on expectations, if those expectations are not fully realized, growth stocks can see dramatic declines. Note, investing in growth stocks can be very risky. If the company such as Microsoft Corp does not do well, investors take a loss on the stock when it is time to sell. Also, because growth stocks typically do not pay dividends, the only opportunity an investor has to make money on their investment is when they eventually sell their shares.
Quick Ratio1.90
Earnings Quarterly Growth46.90%
Revenue Growth21.30%
Payout Ratio27.20%
Enterprise Value To Ebitda26.90
Earnings Growth48.60%
Enterprise Value To Revenue12.94

Microsoft Corp Current Valuation Indicators

Valuation refers to the process of determining the present value of Microsoft Corp and all of its assets. It can be calculated using a number of techniques. As many analysts who try to value Microsoft we look at many different elements of the entity such as Microsoft's management, its prospective future earnings, the current market value of the company's assets, as well as its capital structure formation.
Additionally, see Stocks Correlation. Note that the Microsoft Corp information on this page should be used as a complementary analysis to other Microsoft Corp's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Watchlist Optimization module to optimize watchlists to build efficient portfolio or rebalance existing positions based on mean-variance optimization algorithm.

Complementary Tools for Microsoft Stock analysis

When running Microsoft Corp price analysis, check to measure Microsoft Corp's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Microsoft Corp is operating at the current time. Most of Microsoft Corp's value examination focuses on studying past and present price action to predict the probability of Microsoft Corp's future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Microsoft Corp's price. Additionally, you may evaluate how the addition of Microsoft Corp to your portfolios can decrease your overall portfolio volatility.
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The market value of Microsoft Corp is measured differently than its book value, which is the value of Microsoft that is recorded on the company's balance sheet. Investors also form their own opinion of Microsoft Corp's value that differs from its market value or its book value, called intrinsic value, which is Microsoft Corp's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Microsoft Corp's market value can be influenced by many factors that don't directly affect Microsoft Corp underlying business (such as pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Microsoft Corp's value and its price as these two are different measures arrived at by different means. Investors typically determine Microsoft Corp value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Microsoft Corp's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.