MSFT
Microsoft Corporation
$504.17
▲ 0.9%Updated Aug 7, 11:30 AM ET
MSFT at a glance — five pillars scored 0–100 from real filed financials.
Overall: Strong · 80/100. A wider, greener shape means more pillars look healthy. Dividends scores 0 when a company pays none — that is a choice, not a flaw.
▼ Down 21.0% over the last 12 months
Market Cap
$2.90T
P/E
29.86x
Forward P/E (est.)
23.01x
ROE
33.1%
Revenue Growth
17.9%
EPS Growth
29.8%
Profit Margin
39.3%
FCF Yield
3.1%
Debt / Equity
0.26x
ROIC
22.0%
Interest Coverage
43.79x
Current Ratio
1.28x
Dividend Yield
0.9%
Implied Growth (rev. DCF)
6.4%
Rating Score
80/100
Microsoft pairs a fortress balance sheet with three durable franchises — Azure, Microsoft 365, and Windows — and is monetizing AI faster than any large-cap peer via Copilot and Azure OpenAI. Recurring, enterprise-grade revenue and ~45% operating margins make it one of the highest-quality businesses in the market.
Evidence of durable competitive advantage in the filed financials (10 years of history).
The filed history looks like a business competitors struggle to attack: high and steady margins, revenue that grows through cycles, and strong returns on capital.
69.2% average over the last 3 years
±2.0 pts around 67.2% across 10 years
grew in 9 of the last 9 year-over-year periods
positive in 10 of 10 years
22.0% latest fiscal year
A moat can't be proven by numbers alone — this scores the evidence a durable advantage leaves behind (pricing power, consistency, returns on capital), computed the same way for every stock. Pair it with the business overview before concluding anything.
Institutional-style technical read — sample, educational only
Uptrend — price ($504.17) is above the 50-day ($407.60) and 200-day ($445.44) averages.
Setup type
Trend-continuation swing
Holding time
1–6 weeks
Risk level
Medium
Risk / reward
1 : 0.2
Trade levels
Entry zone
$488.37 – $504.17
Stop loss
$342.62
Target 1
$527.88
Target 2
$555.45
Target 3
$576.61
Position sizing: Scale in; risk ≤ 1% of capital, half-size to start.
Technical analysis
RSI(14) is neutral (50); the MACD histogram is positive (upward momentum). Uptrend — price ($504.17) is above the 50-day ($407.60) and 200-day ($445.44) averages. ATR(14) is $13.17 (~2.6% of price), which sets the stop distance. Recent support sits near $349.20 and resistance near $436.15; the 52-week range is $349.20–$555.45.
Fundamental analysis
Revenue is growing at 17.9%, net margin near 39.3%, ROE roughly 33.1%; shares trade at 30x earnings. Quality score: 80/100.
Options flow
Live options-flow data needs a paid feed, so it isn't shown. For realized volatility, ATR of $13.17 (~2.6%/day) is the range to size stops and any option strikes around.
Volume analysis
The latest session traded 0.9× the 20-day average volume — roughly in line with normal activity.
Catalysts
The next quarterly earnings report is the main near-term catalyst. Technically, watch for a break and hold above $436.15 or a loss of $349.20.
Bullish scenario
Azure is compounding at a mid-to-high 20% rate with AI workloads as a fresh growth vector.
Bearish scenario
Heavy AI capital expenditure pressures free cash flow and returns if demand disappoints.
Invalidation
A daily close below $342.62 invalidates this setup read.
Probability-based scenario using sample data — not a recommendation or a guarantee of profit. Prioritize capital preservation, use stops, and size positions for risk. Past performance does not predict future results.
Technical analysis reads price and volume to judge momentum and timing. It complements the fundamentals above — it does not replace them. Here is what MSFT's chart says today, with each tool explained.
Trend — moving averages. A moving average is the average closing price over a window, which smooths out daily noise. MSFT trades near $504.17, above its 50-day average ($407.60) and 200-day average ($445.44). Price above both averages, with the shorter one above the longer, is the textbook definition of an uptrend — momentum favours buyers.
Momentum — RSI. The Relative Strength Index runs 0–100 and measures how strong recent gains are versus losses. Above 70 is "overbought", below 30 "oversold". At 50 it is in neutral territory — neither stretched nor washed out.
MACD. MACD compares two moving averages to flag shifts in momentum. Its histogram is currently positive — short-term momentum is improving.
Volatility — ATR. Average True Range is the typical daily move. MSFT's is $13.17 (~2.6% of price), so swings of about that size each day are normal — handy for setting a stop that isn't too tight.
Support & resistance. Over the last month MSFT found buyers near $349.20 (support) and sellers near $436.15 (resistance); its 52-week range is $349.20–$555.45. A decisive break beyond either edge often marks the next move.
Volume. The latest session traded 0.9× the 20-day average — about normal. Rising volume on up-days suggests real buying; on down-days, real selling.
Educational information to help you read a chart — not a recommendation or a forecast. It updates daily as the price and indicators change.
4Y CAGR
13.8%
Revenue grew from $91.15B in 2016 to $281.72B in 2025, a 13.4% CAGR. The most recent year grew about 17.9% year over year, a healthy pace pointing to durable demand.
Gross Margin
68.8%
Operating Margin
45.6%
Net Margin
36.1%
ROE
33.1%
Gross margin runs near 68.3% with operating margin around 46.8% and net margin near 39.3%. Return on equity of roughly 33.1% indicates strong capital efficiency, and the margin profile has trended high and stable over the period shown.
Total Debt
$40.26B
Net Debt
$8.16B
Net Debt / EBITDA
0.06x
Debt / Equity
0.26x
Interest-bearing debt is about 1.5% of market capitalization and the debt-to-equity ratio is roughly 0.26x. Leverage is low, leaving the balance sheet well within comfortable limits.
Operating CF
$136.16B
Free Cash Flow
$71.61B
FCF Margin
25.4%
Operating cash flow comfortably exceeds reported net income, and free cash flow yield is around 3.1%. Cash generation is robust and supports buybacks, dividends, and reinvestment.
Can the payout survive a bad year? Scored from filed cash flow, earnings coverage, and the raise/cut record.
The payout is comfortably covered by cash the business actually generates, with a raise habit behind it.
Dividend yield
0.9%
Per share (latest FY)
$3.32
Total paid (latest FY)
$24.08B
History on record
10 years
dividend uses 34% of free cash flow
24% of net income paid out
total dividends increased 9 years in a row
no cuts in the last 10 years on record
Coverage uses the latest fiscal year as filed with the SEC; the streak counts total dollars paid (per-share figures can carry split artifacts). Educational information, not income advice.
P/E
29.86x
P/S
10.37x
P/B
13.78x
EV / EBITDA
24x
Shares trade at roughly 30x trailing earnings (31x forward), 10.4x sales, and 24x EV/EBITDA. That is a full but defensible multiple for a quality franchise. Our internal rating is Strong.
A two-stage discounted cash flow on real SEC-filed free cash flow — the intrinsic-value anchor professional analysts triangulate from.
DCF fair value / share
$356.19
Current price
$504.17
Starting FCF (latest 10-K)
$71.61B
Growth, years 1–5
17.9%
Fade to terminal, years 6–10
2.5%
Discount rate
9.0%
Cash flows grow at the stage-1 rate (trailing revenue growth, capped at 20%) for five years, fade to 2.5% by year 10, and continue at that rate forever (Gordon terminal value), all discounted at 9.0%. Small changes in assumptions move the result a lot — treat this as one reference point, not a target price. Educational only, not investment advice.
Where MSFT sits versus its Information Technology sector peers in the S&P 500.
Bands show the middle half (25th–75th percentile) of the 98 Information Technology companies in the S&P 500 — the peer-relative anchor professional comps analysis uses. Context only — not investment advice.
How MSFT stacks up against its Information Technology peers — valuation, profitability, and growth versus the sector median.
In the Information Technology sector (230 S&P 500 companies), MSFT ranks #8 of 230 by our overall rating. It trades at a discount versus the sector on earnings (29.9x P/E vs. 38.9x median) with a higher return on equity (33.1% vs. 17.5%) and faster revenue growth (17.9% vs. 17.7%).
P/E vs sector
29.9x
median 38.9x
ROE vs sector
33.1%
median 17.5%
Growth vs sector
17.9%
median 17.7%
Sector rank
#8
of 230 by rating
Valuation vs. quality map
The sweet spot is upper-left: more profitable (higher ROE) for a lower P/E. Dashed lines mark the sector median.
Peers are the closest Information Technology companies by sub-industry and size. Sector median is across all 230 S&P 500 names in the sector. Educational, not a recommendation.
Project revenue → earnings → price. Edit the assumptions to build your own case.
2030 price target (Base Case)
$0.00 – $0.00
vs. $504.17 today · expected CAGR 8% – 19%
| Metric | 2026 | 2027 | 2028 | 2029 | 2030 |
|---|---|---|---|---|---|
| Revenue | $332.43B | $392.27B | $462.88B | $546.20B | $644.52B |
| Net income | $119.68B | $141.22B | $166.64B | $196.63B | $232.03B |
| EPS | $20.80 | $24.54 | $28.96 | $34.18 | $40.33 |
| Share price (low) | $374.41 | $441.81 | $521.33 | $615.17 | $725.90 |
| Share price (high) | $624.02 | $736.35 | $868.89 | $1,025.29 | $1,209.84 |
| CAGR (low–high) | -26% / 24% | -6% / 21% | 1% / 20% | 5% / 19% | 8% / 19% |
Educational model on sample fundamentals — not a forecast or investment advice. Outputs are only as good as your assumptions.
- Azure is compounding at a mid-to-high 20% rate with AI workloads as a fresh growth vector.
- Copilot attaches AI monetization across a billion-plus Office users.
- Enterprise switching costs and operating leverage drive consistent margin expansion.
- Heavy AI capital expenditure pressures free cash flow and returns if demand disappoints.
- Cloud growth will eventually decelerate off a very large base.
- A 35x multiple already embeds successful AI monetization.
- AI capex cycle outrunning near-term revenue.
- Cloud competition from AWS and Google.
- Regulatory scrutiny of the OpenAI relationship and bundling practices.
Microsoft is a core long-term holding: a wide-moat compounder with multiple growth engines and the cleanest AI monetization path among mega-caps. The metric to watch is Azure growth versus capex intensity.
Analyst Ratings
What 69 Wall Street analysts covering MSFT recommend (August 2026). Consensus is a useful sanity check — not a substitute for your own homework.
Latest SEC Filings
MSFT's most recent filings, straight from SEC EDGAR. Annual and quarterly reports are the deep dives; 8-Ks flag material events the moment they happen.
In the Idea Lab
MSFT — frequently asked questions
Is MSFT a good stock to buy?
We don't give buy or sell advice. Our model rates Microsoft Corporation Strong (80/100) based on its growth, profitability, financial health, and valuation — use that as a research starting point and make your own decision.
What is MSFT's rating on The Stocks School?
Microsoft Corporation currently scores 80/100 (Strong) on our transparent model, which weighs real fundamentals: growth, margins, returns on capital, balance-sheet strength, and valuation.
How our ratings work →Where does MSFT's data come from?
Live price data plus real fundamentals and 5-year financials pulled directly from Microsoft Corporation's SEC filings — refreshed automatically, not hand-entered.
How is the 5-year projection for MSFT calculated?
It's a scenario model: it grows revenue at an assumed rate, applies a profit margin and a valuation multiple, and shows the resulting share-price range. The assumptions are yours to change — it's a tool for thinking, not a prediction.
Is this MSFT analysis financial advice?
No. Everything on this page is educational research, not financial advice or a recommendation to buy or sell MSFT. Always do your own research and consider a licensed professional.
Data notice. Fundamentals and financial statements are sourced from company filings (SEC EDGAR) and market-data providers; prices and market caps refresh on trading days and may be delayed. Ratings, projections, technical signals, and written summaries are model- or rule-generated for education and may simplify or lag the latest filings.
Not advice. Nothing on this page is investment advice or a recommendation to buy, hold, or sell any security. Do your own research and consult a licensed financial professional before investing.