Microsoft (MSFT)
Information Technology · $4.05T market cap · SEC CIK 0000789019
$533.16
▼−2.20% on the day
close of Nov 10, 2026
91
Screens strongly
ahead of 91% of the S&P 500 · #8 of 73 in Information Technology
ahead of 91% of the S&P 500 · #8 of 73 in Information Technology
Next reports on Jan 26, 2027, with analysts expecting $4.96 in earnings per share.
52-week range $349.20 to $559.15. 5% below its 52-week high and 53% above its low.
The case for MSFT
- Earns 33% back on shareholder equity.
- Generated $67.0B of free cash flow in FY2026, 20% of revenue.
- 41% of revenue drops through to net profit.
- Revenue growing 17.9% year over year.
- Earnings per share up 36.2%.
- Has compounded revenue at 14.6% a year over five years.
The case against
- Weakest against its peers: price/sales of 11.7× is higher than 78% of Information Technology companies.
- Its weakest area is value (46/100): 28.4× earnings against a fair 34× for its growth, 11.7× sales, 1.7% free-cash yield.
What the score is made of
Each factor is half a curve over reported figures and half a rank among the other Information Technology companies (momentum is judged against fixed thresholds only), and the five are blended by weight. The score is where that blend places it in the S&P 500. It describes the last filing and the current price. It is not a forecast.
| Valuewhat you pay for the earnings and cash, against the growth you get | 46 |
|---|---|
| Growthhow fast revenue and earnings are moving, this year and over five | 73 |
| Profitabilityhow much of the revenue becomes profit, and how much of that is cash | 78 |
| Momentumhow the price has behaved lately | 71 |
| Stabilityhow violently it moves, what it owes and what it pays you | 81 |
- Each factor except momentum is half fixed thresholds, half rank among the 73 Information Technology companies.
The financials
Revenue growth
Is the business growing? Yes
| Last 12 months | +17.9% |
|---|---|
| Over 5 years | +14.6% a year |
| FY2026 revenue | $332B (+18%) |
Free cash flow
Is it generating real cash? Yes, plenty
| FY2026 free cash flow | $67.0B |
|---|---|
| Of revenue | 20% |
| Of profit | 50% |
Profit margins
Is profitability improving? Yes, improving
| Gross margin | 68% |
|---|---|
| Operating margin | 47% |
| Net margin, FY25 → FY26 → now | 36.1% → 40.3% → 41.2% |
Debt vs. cash
Is the balance sheet healthy? Yes, the debt is manageable
| Cash | $20.9B |
|---|---|
| Long-term debt | $31.1B |
| Net debt | $10.1B |
| Years to repay | 0.2 yrs |
Valuation
Is the stock price reasonable? Yes, about fair
| P/E | 28.4× |
|---|---|
| Fair P/E for its growth | 34× |
| P/FCF | 60.4× |
| Forward P/E | 24.6× |
| EV / EBITDA | 20.7× |
At 28.4× earnings it trades below the 34× that 17% a year of growth plus a 0.8% dividend would justify. At 60.4× free cash flow it trades well above that same mark.
The financials, five years deep
Pulled from Microsoft's XBRL filings on SEC EDGAR. Italic rows are worked out from the others.
| FY2026 | FY2025 | FY2024 | FY2023 | FY2022 | |
|---|---|---|---|---|---|
| Revenue growth | |||||
| Revenue | $332B | $282B | $245B | $212B | $198B |
| Change on the year | +18% | +15% | +16% | +7% | — |
| Free cash flow | |||||
| Free cash flow | $67.0B | $71.6B | $74.1B | $59.5B | $65.1B |
| Of revenue | 20% | 25% | 30% | 28% | 33% |
| Profit margins | |||||
| Gross margin | 67.9% | 68.8% | 69.8% | 68.9% | 68.4% |
| Operating margin | 46.8% | 45.6% | 44.6% | 41.8% | 42.1% |
| Net margin | 40.3% | 36.1% | 36.0% | 34.1% | 36.7% |
| Debt vs. cash | |||||
| Cash | $20.9B | $30.2B | $18.3B | $34.7B | $13.9B |
| Long-term debt | $31.1B | $40.2B | $42.7B | $42.0B | $47.0B |
| Net cash (debt) | −$10.1B | −$9.9B | −$24.4B | −$7.3B | −$33.1B |
Risk factors MSFT lists in its 10-K
- We make significant investments in products and services that may not achieve expected returns
- Acquisitions, joint ventures, and strategic alliances could have an adverse effect on our business
- Cyberattacks and security vulnerabilities could lead to reduced revenue, increased costs, liability claims, or harm to our reputation or competitive position
- Security of our information technology
- Security of our products, services, devices, and customers’ data
- Development and deployment of defensive measures
- Disclosure and misuse of personal data could result in liability and harm our reputation
- We may not be able to protect information in our products and services from use by others
- Abuse of our platforms may harm our reputation or user engagement
- Advertising, professional, marketplace, and gaming platform abuses
- Our products and services, how they are used by customers, and how third-party products and services interact with them, may present security, privacy, and execution risks
- Issues in the development, deployment, and use of AI may result in reputational or competitive harm or liability
- We may be unable to develop and expand adequate infrastructure
- We may experience outages, disruptions, or capacity constraints if we fail to maintain and operate adequate infrastructure or secure the resources necessary to support it
- We may experience other quality problems
- We are subject to a variety of new, existing, and evolving legal and regulatory requirements that could adversely affect our results of operations
- Competition laws and new market regulation
- Environmental, Social, and Governance
- We have claims and lawsuits against us that may result in adverse outcomes
- Our business with government customers may present additional uncertainties
- We may have additional tax liabilities
- We face risks related to the protection and utilization of our intellectual property that may result in our business and operating results being harmed
- Third parties may claim that we infringe their intellectual property
- Adverse economic or market conditions could harm our business
- Catastrophic events or geopolitical conditions could disrupt our business
- Our global business exposes us to operational and economic risks
- Our business depends on our ability to attract and retain talented employees