MICROSOFT CORP-CDR (MSFT.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:MSFT - CA59516M1041
35.01 CAD
+4.71 (+15.54%)
MSFT gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 64 industry peers in the Software industry. While MSFT has a great profitability rating, there are some minor concerns on its financial health. MSFT may be a bit undervalued, certainly considering the very reasonable score on growth These ratings could make MSFT a good candidate for value investing.
1. Profitability
1.1 Basic Checks
In the past year MSFT was profitable.
In the past year MSFT had a positive cash flow from operations.
In the past 5 years MSFT has always been profitable.
Each year in the past 5 years MSFT had a positive operating cash flow.
1.2 Ratios
MSFT has a Return On Assets of 17.37%. This is amongst the best in the industry. MSFT outperforms 93.94% of its industry peers.
MSFT has a better Return On Equity (30.64%) than 93.94% of its industry peers.
The Return On Invested Capital of MSFT (22.54%) is better than 92.42% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for MSFT is significantly above the industry average of 11.55%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.37% | ||
| ROE | 30.64% | ||
| ROIC | 22.54% |
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
MSFT has a Profit Margin of 35.43%. This is amongst the best in the industry. MSFT outperforms 95.45% of its industry peers.
In the last couple of years the Profit Margin of MSFT has grown nicely.
MSFT has a Operating Margin of 44.96%. This is amongst the best in the industry. MSFT outperforms 98.48% of its industry peers.
In the last couple of years the Operating Margin of MSFT has grown nicely.
MSFT's Gross Margin of 69.41% is fine compared to the rest of the industry. MSFT outperforms 69.70% of its industry peers.
In the last couple of years the Gross Margin of MSFT has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 44.96% | ||
| PM (TTM) | 35.43% | ||
| GM | 69.41% |
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
MSFT has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
MSFT has about the same amout of shares outstanding than it did 1 year ago.
Compared to 5 years ago, MSFT has less shares outstanding
MSFT has a better debt/assets ratio than last year.
2.2 Solvency
MSFT has an Altman-Z score of 2.24. This is not the best score and indicates that MSFT is in the grey zone with still only limited risk for bankruptcy at the moment.
The Altman-Z score of MSFT (2.24) is better than 63.64% of its industry peers.
MSFT has a debt to FCF ratio of 1.16. This is a very positive value and a sign of high solvency as it would only need 1.16 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 1.16, MSFT is doing good in the industry, outperforming 78.79% of the companies in the same industry.
MSFT 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, MSFT perfoms like the industry average, outperforming 57.58% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | 1.16 | ||
| Altman-Z | 2.24 |
ROIC/WACC1.95
WACC11.59%
2.3 Liquidity
A Current Ratio of 1.35 indicates that MSFT should not have too much problems paying its short term obligations.
The Current ratio of MSFT (1.35) is comparable to the rest of the industry.
A Quick Ratio of 1.34 indicates that MSFT should not have too much problems paying its short term obligations.
MSFT has a Quick ratio (1.34) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.35 | ||
| Quick Ratio | 1.34 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 12.30% over the past year.
MSFT shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 19.98% yearly.
The Revenue has grown by 15.04% in the past year. This is quite good.
Measured over the past years, MSFT shows a quite strong growth in Revenue. The Revenue has been growing by 14.26% on average per year.
EPS 1Y (TTM)12.3%
EPS 3Y14.01%
EPS 5Y19.98%
EPS Q2Q%10.24%
Revenue 1Y (TTM)15.04%
Revenue growth 3Y13.4%
Revenue growth 5Y14.26%
Sales Q2Q%12.27%
3.2 Future
The Earnings Per Share is expected to grow by 14.82% on average over the next years. This is quite good.
MSFT is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 13.95% yearly.
EPS Next Y13.17%
EPS Next 2Y13.6%
EPS Next 3Y14.77%
EPS Next 5Y14.82%
Revenue Next Year13.05%
Revenue Next 2Y13.39%
Revenue Next 3Y13.84%
Revenue Next 5Y13.95%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
MSFT is valuated cheaply with a Price/Earnings ratio of 1.99.
Compared to the rest of the industry, the Price/Earnings ratio of MSFT indicates a rather cheap valuation: MSFT is cheaper than 98.48% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 26.34, MSFT is valued rather cheaply.
The Price/Forward Earnings ratio is 1.62, which indicates a rather cheap valuation of MSFT.
Based on the Price/Forward Earnings ratio, MSFT is valued cheaply inside the industry as 96.97% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 23.56, MSFT is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 1.99 | ||
| Fwd PE | 1.62 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, MSFT is valued cheaply inside the industry as 98.48% of the companies are valued more expensively.
96.97% of the companies in the same industry are more expensive than MSFT, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 2.62 | ||
| EV/EBITDA | 0.77 |
4.3 Compensation for Growth
The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
MSFT has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as MSFT's earnings are expected to grow with 14.77% in the coming years.
PEG (NY)0.15
PEG (5Y)0.1
EPS Next 2Y13.6%
EPS Next 3Y14.77%
5. Dividend
5.1 Amount
MSFT has a yearly dividend return of 0.80%, which is pretty low.
MSFT's Dividend Yield is rather good when compared to the industry average which is at 1.73. MSFT pays more dividend than 92.42% of the companies in the same industry.
With a Dividend Yield of 0.80, MSFT pays less dividend than the S&P500 average, which is at 2.31.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.8% |
5.2 History
The dividend of MSFT is nicely growing with an annual growth rate of 10.19%!
MSFT has been paying a dividend for over 5 years, so it has already some track record.
Dividend Growth(5Y)10.19%
Div Incr YearsN/A
Div Non Decr YearsN/A
5.3 Sustainability
24.68% of the earnings are spent on dividend by MSFT. This is a low number and sustainable payout ratio.
MSFT's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP24.68%
EPS Next 2Y13.6%
EPS Next 3Y14.77%
TSX:MSFT (12/8/2025, 7:00:00 PM)
35.01
+4.71 (+15.54%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
Earnings (Next)
Inst Owners74.18%
Inst Owner ChangeN/A
Ins Owners0.03%
Ins Owner ChangeN/A
Market Cap260.26B
Revenue(TTM)261.80B
Net Income(TTM)92.75B
Analysts84.92
Price TargetN/A
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.8% |
Yearly Dividend2.93
Dividend Growth(5Y)10.19%
DP24.68%
Div Incr YearsN/A
Div Non Decr YearsN/A
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)3.11%
Min EPS beat(2)1.79%
Max EPS beat(2)4.43%
EPS beat(4)3
Avg EPS beat(4)1.76%
Min EPS beat(4)-1.43%
Max EPS beat(4)4.43%
EPS beat(8)7
Avg EPS beat(8)3.99%
EPS beat(12)8
Avg EPS beat(12)2.17%
EPS beat(16)12
Avg EPS beat(16)3.56%
Revenue beat(2)0
Avg Revenue beat(2)-0.54%
Min Revenue beat(2)-0.75%
Max Revenue beat(2)-0.32%
Revenue beat(4)0
Avg Revenue beat(4)-0.7%
Min Revenue beat(4)-1.44%
Max Revenue beat(4)-0.26%
Revenue beat(8)2
Avg Revenue beat(8)-0.1%
Revenue beat(12)2
Avg Revenue beat(12)-0.7%
Revenue beat(16)4
Avg Revenue beat(16)-0.36%
PT rev (1m)N/A
PT rev (3m)N/A
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)N/A
EPS NY rev (3m)N/A
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)N/A
Revenue NY rev (3m)N/A
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 1.99 | ||
| Fwd PE | 1.62 | ||
| P/S | 0.7 | ||
| P/FCF | 2.62 | ||
| P/OCF | 1.46 | ||
| P/B | 0.61 | ||
| P/tB | 1.16 | ||
| EV/EBITDA | 0.77 |
EPS(TTM)17.63
EY50.36%
EPS(NY)21.64
Fwd EY61.8%
FCF(TTM)13.37
FCFY38.2%
OCF(TTM)23.98
OCFY68.5%
SpS49.99
BVpS57.8
TBVpS30.19
PEG (NY)0.15
PEG (5Y)0.1
Graham NumberN/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.37% | ||
| ROE | 30.64% | ||
| ROCE | 27.7% | ||
| ROIC | 22.54% | ||
| ROICexc | 27.11% | ||
| ROICexgc | 45.87% | ||
| OM | 44.96% | ||
| PM (TTM) | 35.43% | ||
| GM | 69.41% | ||
| FCFM | 26.75% |
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%
ROICexgc growth 3Y-19.4%
ROICexgc 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-Score6
Asset Turnover0.49
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.24 | ||
| Debt/FCF | 1.16 | ||
| Debt/EBITDA | 0.51 | ||
| Cap/Depr | 208.71% | ||
| Cap/Sales | 21.22% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 87.01% | ||
| Profit Quality | 75.51% | ||
| Current Ratio | 1.35 | ||
| Quick Ratio | 1.34 | ||
| Altman-Z | 2.24 |
F-Score6
WACC11.59%
ROIC/WACC1.95
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)12.3%
EPS 3Y14.01%
EPS 5Y19.98%
EPS Q2Q%10.24%
EPS Next Y13.17%
EPS Next 2Y13.6%
EPS Next 3Y14.77%
EPS Next 5Y14.82%
Revenue 1Y (TTM)15.04%
Revenue growth 3Y13.4%
Revenue growth 5Y14.26%
Sales Q2Q%12.27%
Revenue Next Year13.05%
Revenue Next 2Y13.39%
Revenue Next 3Y13.84%
Revenue Next 5Y13.95%
EBIT growth 1Y17.09%
EBIT growth 3Y16.11%
EBIT growth 5Y20.56%
EBIT Next Year40.23%
EBIT Next 3Y23.1%
EBIT Next 5Y19.13%
FCF growth 1Y17.47%
FCF growth 3Y9.69%
FCF growth 5Y14.13%
OCF growth 1Y48.82%
OCF growth 3Y15.6%
OCF growth 5Y17.83%
MICROSOFT CORP-CDR / MSFT.CA FAQ
Can you provide the ChartMill fundamental rating for MICROSOFT CORP-CDR?
ChartMill assigns a fundamental rating of 7 / 10 to MSFT.CA.
What is the valuation status for MSFT stock?
ChartMill assigns a valuation rating of 9 / 10 to MICROSOFT CORP-CDR (MSFT.CA). This can be considered as Undervalued.
Can you provide the profitability details for MICROSOFT CORP-CDR?
MICROSOFT CORP-CDR (MSFT.CA) has a profitability rating of 9 / 10.
What are the PE and PB ratios of MICROSOFT CORP-CDR (MSFT.CA) stock?
The Price/Earnings (PE) ratio for MICROSOFT CORP-CDR (MSFT.CA) is 1.99 and the Price/Book (PB) ratio is 0.61.
What is the earnings growth outlook for MICROSOFT CORP-CDR?
The Earnings per Share (EPS) of MICROSOFT CORP-CDR (MSFT.CA) is expected to grow by 13.17% in the next year.