At this time, the firm appears to be undervalued. Microsoft secures a last-minute Real Value of $513.52 per share. The latest price of the firm is $401.14. Our model forecasts the value of Microsoft from analyzing the firm fundamentals such as Current Valuation of 3.04 T, return on equity of 0.34, and Profit Margin of 0.39 % as well as examining its technical indicators and probability of bankruptcy. Key fundamental drivers impacting Microsoft's valuation include:
Price Book
7.8686
Enterprise Value
3 T
Enterprise Value Ebitda
16.1647
Price Sales
9.5789
Forward PE
25.1889
Undervalued
Today
401.14
Please note that Microsoft's price fluctuation is very steady at this time. Calculation of the real value of Microsoft is based on 3 months time horizon. Increasing Microsoft's time horizon generally increases the accuracy of value calculation and significantly improves the predictive power of the methodology used.
Microsoft's intrinsic value may or may not be the same as its current market price of 401.14, in which case there is an opportunity to profit from the mispricing, assuming the market price will eventually merge with its intrinsic value.
Historical
Market 401.14
Real 513.52
Target 599.86
Hype 403.69
Naive 380.37
The intrinsic value of Microsoft's stock can be calculated using various methods such as discounted cash flow analysis, price-to-earnings ratio, or price-to-book ratio. That value may differ from its current market price, which is determined by supply and demand factors such as investor sentiment, market trends, news, and other external factors that may influence Microsoft's stock price. It is important to note that the real value of any stock may change over time based on changes in the company's performance.
Estimating the potential upside or downside of Microsoft 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 more accurately as focusing exclusively on Microsoft's fundamentals will not take into account other important factors:
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's intrinsic value based on its ongoing forecasts of Microsoft's financial statements. In contrast, other private, professional wealth advisors use a multiplier approach by looking to relative value analysis against Microsoft's closest peers.
Microsoft Cash
36.52 Billion
Microsoft Revenue by Product
Microsoft Total Value Analysis
Microsoft is now forecasted to have valuation of 3.04 T with market capitalization of 2.93 T, debt of 60.59 B, and cash on hands of 30.24 B. Please note that valuation may be misleading and is a subject to auditing or accounting errors. We encourage investors to vigilantly validate all of the Microsoft fundamentals before making equity appraisal based on enterprise value of the company
About 76.0% of the company shares are owned by institutional investors. The company has Price/Earnings To Growth (PEG) ratio of 1.59. Microsoft recorded earning per share (EPS) of 15.98. The entity last dividend was issued on the 19th of February 2026. The firm had 2:1 split on the 18th of February 2003. Based on the key indicators related to Microsoft's liquidity, profitability, solvency, and operating efficiency, Microsoft may be sliding down financialy. It has an above-average chance of going through some form of financial crunch next quarter.
The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. Microsoft has an asset utilization ratio of 45.51 percent. This implies that the Company is making $0.46 for each dollar of assets. An increasing asset utilization means that Microsoft is more efficient with each dollar of assets it utilizes for everyday operations.
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Dot-com Bubble
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Covid
Interest Hikes
Microsoft Profitability Analysis
Based on Microsoft's profitability indicators, Microsoft's profitability may be sliding down. It has an above-average chance of reporting lower numbers next quarter. Profitability indicators assess Microsoft's ability to earn profits and add value for shareholders.
Net Income
First Reported
1985-09-30
Previous Quarter
27.7 B
Current Value
38.5 B
Quarterly Volatility
7.2 B
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Interest Hikes
At this time, Microsoft's Gross Profit is comparatively stable compared to the past year. Gross Profit Margin is likely to gain to 0.86 in 2026, whereas Pretax Profit Margin is likely to drop 0.42 in 2026.
For Microsoft profitability analysis, we use financial ratios and fundamental drivers that measure the ability of Microsoft to generate income relative to revenue, assets, operating costs, and current equity. These fundamental indicators attest to how well Microsoft utilizes its assets to generate profit and value for its shareholders. The profitability module also shows relationships between Microsoft's most relevant fundamental drivers. It provides multiple suggestions of what could affect the performance of Microsoft over time as well as its relative position and ranking within its peers.
Microsoft Earnings per Share Projection vs Actual
The next projected EPS of Microsoft is estimated to be 4.0787 with future projections ranging from a low of 3.7 to a high of 5.3. Microsoft's most recent 12-month trailing earnings per share (EPS TTM) is at 15.98. Please be aware that the consensus of earnings estimates for Microsoft is based on EPS before non-recurring items and includes expenses related to employee stock options.
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Yuan Drop
Covid
Interest Hikes
Microsoft is projected to generate 4.0787 in earnings per share on the 31st of March 2026. Microsoft earnings estimates show analyst consensus about projected Microsoft EPS (Earning Per Share). It derives the highest and the lowest estimates based on Microsoft's historical volatility. Many public companies, such as Microsoft, manage the perception of their earnings on a regular basis to make sure that analyst estimates are accurate. Future earnings calculations are also an essential input when attempting to value a firm.
Microsoft Earnings Estimation Breakdown
The calculation of Microsoft's earning per share is based on the data from the past 12 consecutive months, used for reporting the company's financial figures. The next projected EPS of Microsoft is estimated to be 4.0787 with the future projection ranging from a low of 3.7 to a high of 5.3. Please be aware that this consensus of annual earnings estimates for Microsoft is based on EPS before non-recurring items and includes expenses related to employee stock options.
Last Reported EPS
5.16
3.70
Lowest
Expected EPS
4.0787
5.30
Highest
Microsoft Earnings Projection Consensus
Suppose the current estimates of Microsoft's value are higher than the current market price of the Microsoft stock. In this case, investors may conclude that Microsoft is overpriced and will exhibit bullish sentiment. On the other hand, if the present value is lower than the stock price, analysts may conclude that the market undervalues the equity. These scenarios may suggest that the market is not as efficient as it should be at the estimation time, and Microsoft's stock will quickly adjusts to the new information provided by the consensus estimate.
Number of Analysts
Historical Accuracy
Last Reported EPS
Estimated EPS for 31st of March 2026
Current EPS (TTM)
56
93.9%
5.16
4.0787
15.98
Microsoft Ownership Allocation
Microsoft maintains a total of 7.43 Billion outstanding shares. The majority of Microsoft outstanding shares are owned by institutional investors. These third-party entities are usually referred to as non-private investors looking to shop for positions in Microsoft to benefit from reduced commissions. Consequently, institutional holders are subject to a different set of regulations than regular investors in Microsoft. Please pay attention to any change in the institutional holdings of Microsoft as this could imply that something significant has changed or is about to change at the company. On February 3, 2026, Representative David Taylor of US Congress acquired under $15k worth of Microsoft's common stock.
Microsoft Profitability Analysis
The company reported the previous year's revenue of 281.72 B. Net Income was 101.83 B with profit before overhead, payroll, taxes, and interest of 209.5 B.
The stock valuation mechanism determines Microsoft's current worth on a daily basis. In general, an absolute valuation approach attempts to find the value of Microsoft based exclusively on its fundamental and basic technical indicators. As compared to an absolute model, our relative valuation model uses a comparative analysis of Microsoft. We calculate exposure to Microsoft's market risk, different technical and fundamental indicators, and relevant financial multiples and ratios and then compare them to those of Microsoft's related companies.
Microsoft's stock price is the clearest measure of market expectations about its performance. Without stock valuation, investors cannot independently discern whether Microsoft's value is low or high relative to the company's performance and growth projections. Determining the market value of Microsoft can be done in different ways, such as multiplying its stock price by its outstanding shares.
A single share of Microsoft represents a small ownership stake in the entity. As a stockholder of Microsoft, your percentage of company ownership is determined by dividing the number of shares you own by the total number of shares outstanding and then multiplying that amount by 100. Owning stock in a company generally confers both corporate voting rights and income from any dividends paid to the stock owner.
There are various types of dividends Microsoft 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 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 by the value of the dividends paid out.
Microsoft Growth Indicators
Investing in growth stocks can be very risky. If the company such as Microsoft 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.
Common Stock Shares Outstanding
7.5 B
Quarterly Earnings Growth Y O Y
0.598
Forward Price Earnings
25.1889
Microsoft Current Valuation Indicators
Microsoft's valuation analysis is a process of estimating the intrinsic value of all assets and outstanding equities. There are different methodologies and models we use to develop the final Microsoft's valuation. The techniques such as discounted cash flow and fundamental indicators such as book value per share or market capitalization are well known and widely used across most financial advisers and money managers.
Valuations are an essential part of business, for companies themselves, but also for investors. For companies, such as Microsoft, valuations can help measure their progress and success and can help them track their performance in the market compared to others. In addition, investors can use Microsoft's valuations to help determine the worth of potential investments. They can do this by using data and information made public by a company. Regardless of who the valuation is for, it essentially describes Microsoft's worth.
Additional Tools for Microsoft Stock Analysis
When running Microsoft's price analysis, check to measure Microsoft'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 is operating at the current time. Most of Microsoft's value examination focuses on studying past and present price action to predict the probability of Microsoft's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Microsoft's price. Additionally, you may evaluate how the addition of Microsoft to your portfolios can decrease your overall portfolio volatility.