MICROSOFT CORP (MSF.DE) Stock Fundamental Analysis
FRA:MSF - Deutsche Boerse Ag - US5949181045 - Common Stock - Currency: EUR
Overall MSF gets a fundamental rating of 7 out of 10. We evaluated MSF against 100 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 quite expensive at the moment. It does show a decent growth rate. These ratings would make MSF suitable 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.
Each year in the past 5 years MSF has 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 17.18% is amongst the best of the industry. MSF outperforms 96.00% of its industry peers.
MSF has a Return On Equity of 30.02%. This is amongst the best in the industry. MSF outperforms 90.00% of its industry peers.
With an excellent Return On Invested Capital value of 22.17%, MSF belongs to the best of the industry, outperforming 95.00% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for MSF is significantly above the industry average of 11.09%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.18% | ||
| ROE | 30.02% | ||
| ROIC | 22.17% |
ROA(3y)18.24%
ROA(5y)17.55%
ROE(3y)37.2%
ROE(5y)38.43%
ROIC(3y)23.84%
ROIC(5y)22.71%
1.3 Margins
Looking at the Profit Margin, with a value of 35.79%, MSF belongs to the top of the industry, outperforming 97.00% of the companies in the same industry.
MSF's Profit Margin has improved in the last couple of years.
With an excellent Operating Margin value of 45.23%, MSF belongs to the best of the industry, outperforming 98.00% of the companies in the same industry.
In the last couple of years the Operating Margin of MSF has grown nicely.
MSF has a Gross Margin (69.07%) which is in line with its industry peers.
MSF's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 45.23% | ||
| PM (TTM) | 35.79% | ||
| GM | 69.07% |
OM growth 3Y2.39%
OM growth 5Y5.51%
PM growth 3Y-0.46%
PM growth 5Y2.89%
GM growth 3Y0.4%
GM growth 5Y1.15%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), MSF 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.
Compared to 1 year ago, MSF has an improved debt to assets ratio.
2.2 Solvency
MSF has an Altman-Z score of 10.93. This indicates that MSF is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 10.93, MSF belongs to the best of the industry, outperforming 90.00% of the companies in the same industry.
MSF has a debt to FCF ratio of 1.18. This is a very positive value and a sign of high solvency as it would only need 1.18 years to pay back of all of its debts.
MSF's Debt to FCF ratio of 1.18 is fine compared to the rest of the industry. MSF outperforms 80.00% of its industry peers.
MSF has a Debt/Equity ratio of 0.24. This is a healthy value indicating a solid balance between debt and equity.
With a Debt to Equity ratio value of 0.24, MSF perfoms like the industry average, outperforming 60.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | 1.18 | ||
| Altman-Z | 10.93 |
ROIC/WACC2.52
WACC8.78%
2.3 Liquidity
A Current Ratio of 1.37 indicates that MSF should not have too much problems paying its short term obligations.
The Current ratio of MSF (1.37) is comparable to the rest of the industry.
A Quick Ratio of 1.36 indicates that MSF should not have too much problems paying its short term obligations.
MSF's Quick ratio of 1.36 is in line compared to the rest of the industry. MSF outperforms 59.00% of its industry peers.
MSF does not score too well on the current and quick ratio evaluation. However, as it has 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 | 1.37 | ||
| Quick Ratio | 1.36 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 12.03% over the past year.
Measured over the past years, MSF shows a quite strong growth in Earnings Per Share. The EPS has been growing by 19.98% on average per year.
The Revenue has grown by 14.13% in the past year. This is quite good.
Measured over the past years, MSF shows a quite strong growth in Revenue. The Revenue has been growing by 14.26% on average per year.
EPS 1Y (TTM)12.03%
EPS 3Y14.01%
EPS 5Y19.98%
EPS Q2Q%17.69%
Revenue 1Y (TTM)14.13%
Revenue growth 3Y13.4%
Revenue growth 5Y14.26%
Sales Q2Q%13.27%
3.2 Future
MSF is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 15.57% yearly.
The Revenue is expected to grow by 13.26% on average over the next years. This is quite good.
EPS Next Y15.42%
EPS Next 2Y14.15%
EPS Next 3Y15.11%
EPS Next 5Y15.57%
Revenue Next Year13.95%
Revenue Next 2Y13.72%
Revenue Next 3Y13.94%
Revenue Next 5Y13.26%
3.3 Evolution
Although the future EPS growth is still strong, it is not able to hold up the even more excellent growth rate of the past 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
The Price/Earnings ratio is 37.81, which means the current valuation is very expensive for MSF.
MSF's Price/Earnings ratio is a bit cheaper when compared to the industry. MSF is cheaper than 71.00% of the companies in the same industry.
MSF is valuated rather expensively when we compare the Price/Earnings ratio to 27.28, which is the current average of the S&P500 Index.
Based on the Price/Forward Earnings ratio of 31.80, 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 21.76, MSF is valued a bit more expensive.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.81 | ||
| Fwd PE | 31.8 |
4.2 Price Multiples
MSF's Enterprise Value to EBITDA ratio is in line with the industry average.
MSF's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. MSF is cheaper than 62.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 52.44 | ||
| EV/EBITDA | 23.79 |
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.
A more expensive valuation may be justified as MSF's earnings are expected to grow with 15.11% in the coming years.
PEG (NY)2.45
PEG (5Y)1.89
EPS Next 2Y14.15%
EPS Next 3Y15.11%
5. Dividend
5.1 Amount
MSF has a yearly dividend return of 0.67%, which is pretty low.
Compared to an average industry Dividend Yield of 2.13, MSF pays a bit more dividend than its industry peers.
With a Dividend Yield of 0.67, MSF pays less dividend than the S&P500 average, which is at 2.42.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.67% |
5.2 History
The dividend of MSF is nicely growing with an annual growth rate of 10.19%!
Dividend Growth(5Y)10.19%
Div Incr Years6
Div Non Decr Years6
5.3 Sustainability
24.30% of the earnings are spent on dividend by MSF. This is a low number and sustainable payout ratio.
The dividend of MSF is growing, but earnings are growing more, so the dividend growth is sustainable.
DP24.3%
EPS Next 2Y14.15%
EPS Next 3Y15.11%
FRA:MSF (7/3/2025, 1:50:30 PM)
416.3
-1.65 (-0.39%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners74.47%
Inst Owner ChangeN/A
Ins Owners0.03%
Ins Owner ChangeN/A
Market Cap3094.17B
Analysts84.64
Price Target453.24 (8.87%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.67% |
Yearly Dividend2.5
Dividend Growth(5Y)10.19%
DP24.3%
Div Incr Years6
Div Non Decr Years6
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.56%
Min EPS beat(2)1.79%
Max EPS beat(2)5.34%
EPS beat(4)3
Avg EPS beat(4)2.53%
Min EPS beat(4)-1.43%
Max EPS beat(4)5.34%
EPS beat(8)7
Avg EPS beat(8)3.7%
EPS beat(12)9
Avg EPS beat(12)2.65%
EPS beat(16)12
Avg EPS beat(16)3.43%
Revenue beat(2)1
Avg Revenue beat(2)-0.18%
Min Revenue beat(2)-0.75%
Max Revenue beat(2)0.4%
Revenue beat(4)1
Avg Revenue beat(4)-0.53%
Min Revenue beat(4)-1.44%
Max Revenue beat(4)0.4%
Revenue beat(8)2
Avg Revenue beat(8)-0.25%
Revenue beat(12)3
Avg Revenue beat(12)-0.56%
Revenue beat(16)5
Avg Revenue beat(16)-0.31%
PT rev (1m)0.52%
PT rev (3m)-3.07%
EPS NQ rev (1m)0%
EPS NQ rev (3m)0.81%
EPS NY rev (1m)0.03%
EPS NY rev (3m)2.02%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)1.58%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.8%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 37.81 | ||
| Fwd PE | 31.8 | ||
| P/S | 13.47 | ||
| P/FCF | 52.44 | ||
| P/OCF | 27.83 | ||
| P/B | 11.3 | ||
| P/tB | 20.37 | ||
| EV/EBITDA | 23.79 |
EPS(TTM)11.01
EY2.64%
EPS(NY)13.09
Fwd EY3.14%
FCF(TTM)7.94
FCFY1.91%
OCF(TTM)14.96
OCFY3.59%
SpS30.9
BVpS36.84
TBVpS20.44
PEG (NY)2.45
PEG (5Y)1.89
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.18% | ||
| ROE | 30.02% | ||
| ROCE | 27.24% | ||
| ROIC | 22.17% | ||
| ROICexc | 26.95% | ||
| ROICexgc | 44.08% | ||
| OM | 45.23% | ||
| PM (TTM) | 35.79% | ||
| GM | 69.07% | ||
| FCFM | 25.69% |
ROA(3y)18.24%
ROA(5y)17.55%
ROE(3y)37.2%
ROE(5y)38.43%
ROIC(3y)23.84%
ROIC(5y)22.71%
ROICexc(3y)35.43%
ROICexc(5y)40.49%
ROICexgc(3y)63.99%
ROICexgc(5y)78.75%
ROCE(3y)29.44%
ROCE(5y)28%
ROICexcg growth 3Y-19.4%
ROICexcg growth 5Y-12.98%
ROICexc growth 3Y-17.33%
ROICexc growth 5Y-7.77%
OM growth 3Y2.39%
OM growth 5Y5.51%
PM growth 3Y-0.46%
PM growth 5Y2.89%
GM growth 3Y0.4%
GM growth 5Y1.15%
F-Score5
Asset Turnover0.48
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | 1.18 | ||
| Debt/EBITDA | 0.5 | ||
| Cap/Depr | 209.15% | ||
| Cap/Sales | 22.72% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 86.3% | ||
| Profit Quality | 71.78% | ||
| Current Ratio | 1.37 | ||
| Quick Ratio | 1.36 | ||
| Altman-Z | 10.93 |
F-Score5
WACC8.78%
ROIC/WACC2.52
Cap/Depr(3y)189.18%
Cap/Depr(5y)172.93%
Cap/Sales(3y)14.49%
Cap/Sales(5y)13.3%
Profit Quality(3y)85.27%
Profit Quality(5y)89.91%
High Growth Momentum
Growth
EPS 1Y (TTM)12.03%
EPS 3Y14.01%
EPS 5Y19.98%
EPS Q2Q%17.69%
EPS Next Y15.42%
EPS Next 2Y14.15%
EPS Next 3Y15.11%
EPS Next 5Y15.57%
Revenue 1Y (TTM)14.13%
Revenue growth 3Y13.4%
Revenue growth 5Y14.26%
Sales Q2Q%13.27%
Revenue Next Year13.95%
Revenue Next 2Y13.72%
Revenue Next 3Y13.94%
Revenue Next 5Y13.26%
EBIT growth 1Y15.48%
EBIT growth 3Y16.11%
EBIT growth 5Y20.56%
EBIT Next Year44.54%
EBIT Next 3Y24.22%
EBIT Next 5Y20.76%
FCF growth 1Y20.83%
FCF growth 3Y9.69%
FCF growth 5Y14.13%
OCF growth 1Y56.65%
OCF growth 3Y15.6%
OCF growth 5Y17.83%