414.19 USD
+2.98 (+0.72%)
At close: Feb 4, 2026
410.1 USD
-4.09 (-0.99%)
After Hours: 2/4/2026, 6:41:02 PM
Overall MSFT gets a fundamental rating of 7 out of 10. We evaluated MSFT against 278 industry peers in the Software industry. Both the health and profitability get an excellent rating, making MSFT a very profitable company, without any liquidiy or solvency issues. MSFT is showing excellent growth while it is valued at reasonable prices. Keep and eye on this one! Finally MSFT also has an excellent dividend rating. These ratings would make MSFT suitable for dividend and growth and quality investing!
1. Profitability
1.1 Basic Checks
- MSFT had positive earnings in the past year.
- MSFT had a positive operating cash flow in the past year.
- In the past 5 years MSFT has always been profitable.
- In the past 5 years MSFT always reported a positive cash flow from operatings.
1.2 Ratios
- MSFT has a better Return On Assets (17.93%) than 93.53% of its industry peers.
- MSFT's Return On Equity of 30.51% is amongst the best of the industry. MSFT outperforms 92.45% of its industry peers.
- MSFT's Return On Invested Capital of 21.86% is amongst the best of the industry. MSFT outperforms 94.60% of its industry peers.
- MSFT had an Average Return On Invested Capital over the past 3 years of 22.94%. This is significantly above the industry average of 10.78%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.93% | ||
| ROE | 30.51% | ||
| ROIC | 21.86% |
ROA(3y)17.07%
ROA(5y)17.9%
ROE(3y)32.52%
ROE(5y)36.88%
ROIC(3y)22.94%
ROIC(5y)23.52%
1.3 Margins
- Looking at the Profit Margin, with a value of 39.04%, MSFT belongs to the top of the industry, outperforming 92.81% of the companies in the same industry.
- MSFT's Profit Margin has improved in the last couple of years.
- The Operating Margin of MSFT (46.67%) is better than 96.76% of its industry peers.
- In the last couple of years the Operating Margin of MSFT has grown nicely.
- With a Gross Margin value of 68.59%, MSFT perfoms like the industry average, outperforming 50.36% of the companies in the same industry.
- 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 | 46.67% | ||
| PM (TTM) | 39.04% | ||
| GM | 68.59% |
OM growth 3Y2.75%
OM growth 5Y4.26%
PM growth 3Y-0.49%
PM growth 5Y3.14%
GM growth 3Y0.21%
GM growth 5Y0.31%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), MSFT is creating value.
- The number of shares outstanding for MSFT remains at a similar level compared to 1 year ago.
- The number of shares outstanding for MSFT has been reduced compared to 5 years ago.
- Compared to 1 year ago, MSFT has an improved debt to assets ratio.
2.2 Solvency
- An Altman-Z score of 8.53 indicates that MSFT is not in any danger for bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 8.53, MSFT belongs to the top of the industry, outperforming 90.29% of the companies in the same industry.
- MSFT has a debt to FCF ratio of 1.30. This is a very positive value and a sign of high solvency as it would only need 1.30 years to pay back of all of its debts.
- MSFT has a better Debt to FCF ratio (1.30) than 72.30% of its industry peers.
- MSFT has a Debt/Equity ratio of 0.23. This is a healthy value indicating a solid balance between debt and equity.
- MSFT's Debt to Equity ratio of 0.23 is in line compared to the rest of the industry. MSFT outperforms 43.17% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.23 | ||
| Debt/FCF | 1.3 | ||
| Altman-Z | 8.53 |
ROIC/WACC1.98
WACC11.03%
2.3 Liquidity
- A Current Ratio of 1.39 indicates that MSFT should not have too much problems paying its short term obligations.
- MSFT's Current ratio of 1.39 is in line compared to the rest of the industry. MSFT outperforms 43.17% of its industry peers.
- MSFT has a Quick Ratio of 1.38. This is a normal value and indicates that MSFT is financially healthy and should not expect problems in meeting its short term obligations.
- Looking at the Quick ratio, with a value of 1.38, MSFT is in line with its industry, outperforming 42.81% of the companies in the same industry.
- The current and quick ratio evaluation for MSFT is rather negative, while it does have 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 | 1.39 | ||
| Quick Ratio | 1.38 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an impressive 23.83% over the past year.
- The Earnings Per Share has been growing by 18.86% on average over the past years. This is quite good.
- MSFT shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 16.67%.
- The Revenue has been growing by 14.52% on average over the past years. This is quite good.
EPS 1Y (TTM)23.83%
EPS 3Y14.03%
EPS 5Y18.86%
EPS Q2Q%28.17%
Revenue 1Y (TTM)16.67%
Revenue growth 3Y12.42%
Revenue growth 5Y14.52%
Sales Q2Q%16.72%
3.2 Future
- MSFT is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 18.83% yearly.
- Based on estimates for the next years, MSFT will show a quite strong growth in Revenue. The Revenue will grow by 15.04% on average per year.
EPS Next Y24.51%
EPS Next 2Y19.37%
EPS Next 3Y18.79%
EPS Next 5Y18.83%
Revenue Next Year17.53%
Revenue Next 2Y16.55%
Revenue Next 3Y16.52%
Revenue Next 5Y15.04%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
- 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
- With a Price/Earnings ratio of 26.93, MSFT can be considered very expensive at the moment.
- Based on the Price/Earnings ratio, MSFT is valued a bit cheaper than 60.79% of the companies in the same industry.
- Compared to an average S&P500 Price/Earnings ratio of 28.25, MSFT is valued at the same level.
- MSFT is valuated rather expensively with a Price/Forward Earnings ratio of 21.31.
- 64.39% of the companies in the same industry are more expensive than MSFT, based on the Price/Forward Earnings ratio.
- The average S&P500 Price/Forward Earnings ratio is at 27.50. MSFT is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.93 | ||
| Fwd PE | 21.31 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, MSFT is valued a bit cheaper than the industry average as 77.70% of the companies are valued more expensively.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of MSFT is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 39.77 | ||
| EV/EBITDA | 16.69 |
4.3 Compensation for Growth
- MSFT's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct 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 18.79% in the coming years.
PEG (NY)1.1
PEG (5Y)1.43
EPS Next 2Y19.37%
EPS Next 3Y18.79%
5. Dividend
5.1 Amount
- With a yearly dividend of 0.86%, MSFT is not a good candidate for dividend investing.
- MSFT's Dividend Yield is rather good when compared to the industry average which is at 0.56. MSFT pays more dividend than 91.01% of the companies in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.82, MSFT's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.86% |
5.2 History
- On average, the dividend of MSFT grows each year by 10.24%, which is quite nice.
- MSFT has been paying a dividend for at least 10 years, so it has a reliable track record.
- MSFT has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)10.24%
Div Incr Years20
Div Non Decr Years20
5.3 Sustainability
- 21.19% of the earnings are spent on dividend by MSFT. This is a low number and sustainable payout ratio.
- The dividend of MSFT is growing, but earnings are growing more, so the dividend growth is sustainable.
DP21.19%
EPS Next 2Y19.37%
EPS Next 3Y18.79%
414.19
+2.98 (+0.72%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)01-28 2026-01-28/amc
Earnings (Next)04-28 2026-04-28/amc
Inst Owners75.56%
Inst Owner Change-2.49%
Ins Owners0.03%
Ins Owner Change0.03%
Market Cap3.08T
Revenue(TTM)305.45B
Net Income(TTM)119.26B
Analysts85.97
Price Target612.29 (47.83%)
Short Float %0.74%
Short Ratio1.94
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.86% |
Yearly Dividend3.24
Dividend Growth(5Y)10.24%
DP21.19%
Div Incr Years20
Div Non Decr Years20
Ex-Date02-19 2026-02-19 (0.91)
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.37%
Min EPS beat(2)2.28%
Max EPS beat(2)10.46%
EPS beat(4)4
Avg EPS beat(4)6.07%
Min EPS beat(4)2.28%
Max EPS beat(4)10.46%
EPS beat(8)7
Avg EPS beat(8)3.92%
EPS beat(12)11
Avg EPS beat(12)4.68%
EPS beat(16)12
Avg EPS beat(16)3.14%
Revenue beat(2)1
Avg Revenue beat(2)0.18%
Min Revenue beat(2)-0.73%
Max Revenue beat(2)1.09%
Revenue beat(4)3
Avg Revenue beat(4)0.57%
Min Revenue beat(4)-0.73%
Max Revenue beat(4)1.54%
Revenue beat(8)3
Avg Revenue beat(8)-0.06%
Revenue beat(12)5
Avg Revenue beat(12)0.13%
Revenue beat(16)5
Avg Revenue beat(16)-0.38%
PT rev (1m)-0.12%
PT rev (3m)1.32%
EPS NQ rev (1m)0.04%
EPS NQ rev (3m)4.08%
EPS NY rev (1m)0.12%
EPS NY rev (3m)5.98%
Revenue NQ rev (1m)0.03%
Revenue NQ rev (3m)0.73%
Revenue NY rev (1m)0.03%
Revenue NY rev (3m)1.39%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 26.93 | ||
| Fwd PE | 21.31 | ||
| P/S | 10.08 | ||
| P/FCF | 39.77 | ||
| P/OCF | 19.18 | ||
| P/B | 7.88 | ||
| P/tB | 12.27 | ||
| EV/EBITDA | 16.69 |
EPS(TTM)15.38
EY3.71%
EPS(NY)19.44
Fwd EY4.69%
FCF(TTM)10.42
FCFY2.51%
OCF(TTM)21.6
OCFY5.21%
SpS41.1
BVpS52.59
TBVpS33.77
PEG (NY)1.1
PEG (5Y)1.43
Graham Number134.9
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 17.93% | ||
| ROE | 30.51% | ||
| ROCE | 26.63% | ||
| ROIC | 21.86% | ||
| ROICexc | 26.24% | ||
| ROICexgc | 38.24% | ||
| OM | 46.67% | ||
| PM (TTM) | 39.04% | ||
| GM | 68.59% | ||
| FCFM | 25.34% |
ROA(3y)17.07%
ROA(5y)17.9%
ROE(3y)32.52%
ROE(5y)36.88%
ROIC(3y)22.94%
ROIC(5y)23.52%
ROICexc(3y)31.07%
ROICexc(5y)36.94%
ROICexgc(3y)52.63%
ROICexgc(5y)67.5%
ROCE(3y)28.11%
ROCE(5y)28.75%
ROICexgc growth 3Y-18.02%
ROICexgc growth 5Y-15.78%
ROICexc growth 3Y-12.77%
ROICexc growth 5Y-10.15%
OM growth 3Y2.75%
OM growth 5Y4.26%
PM growth 3Y-0.49%
PM growth 5Y3.14%
GM growth 3Y0.21%
GM growth 5Y0.31%
F-Score6
Asset Turnover0.46
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.23 | ||
| Debt/FCF | 1.3 | ||
| Debt/EBITDA | 0.51 | ||
| Cap/Depr | 222.84% | ||
| Cap/Sales | 27.2% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 89.25% | ||
| Profit Quality | 64.91% | ||
| Current Ratio | 1.39 | ||
| Quick Ratio | 1.38 | ||
| Altman-Z | 8.53 |
F-Score6
WACC11.03%
ROIC/WACC1.98
Cap/Depr(3y)197.12%
Cap/Depr(5y)186.6%
Cap/Sales(3y)18.11%
Cap/Sales(5y)15.73%
Profit Quality(3y)78.85%
Profit Quality(5y)83.54%
High Growth Momentum
Growth
EPS 1Y (TTM)23.83%
EPS 3Y14.03%
EPS 5Y18.86%
EPS Q2Q%28.17%
EPS Next Y24.51%
EPS Next 2Y19.37%
EPS Next 3Y18.79%
EPS Next 5Y18.83%
Revenue 1Y (TTM)16.67%
Revenue growth 3Y12.42%
Revenue growth 5Y14.52%
Sales Q2Q%16.72%
Revenue Next Year17.53%
Revenue Next 2Y16.55%
Revenue Next 3Y16.52%
Revenue Next 5Y15.04%
EBIT growth 1Y21.11%
EBIT growth 3Y15.52%
EBIT growth 5Y19.4%
EBIT Next Year57.72%
EBIT Next 3Y28.9%
EBIT Next 5Y23.22%
FCF growth 1Y14.78%
FCF growth 3Y3.2%
FCF growth 5Y9.62%
OCF growth 1Y56.37%
OCF growth 3Y15.21%
OCF growth 5Y17.55%
MICROSOFT CORP / MSFT FAQ
Can you provide the ChartMill fundamental rating for MICROSOFT CORP?
ChartMill assigns a fundamental rating of 7 / 10 to MSFT.
Can you provide the valuation status for MICROSOFT CORP?
ChartMill assigns a valuation rating of 4 / 10 to MICROSOFT CORP (MSFT). This can be considered as Fairly Valued.
Can you provide the profitability details for MICROSOFT CORP?
MICROSOFT CORP (MSFT) has a profitability rating of 8 / 10.
What is the financial health of MICROSOFT CORP (MSFT) stock?
The financial health rating of MICROSOFT CORP (MSFT) is 8 / 10.
What is the expected EPS growth for MICROSOFT CORP (MSFT) stock?
The Earnings per Share (EPS) of MICROSOFT CORP (MSFT) is expected to grow by 24.51% in the next year.