Fact based stock research
Microsoft (NasdaqGS:MSFT)

US5949181045

How to read the free ranks

For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".

Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.

Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.

(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).

(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.

Microsoft stock research in summary

microsoft.com

ANALYSIS: With an Obermatt Combined Rank of 80 (better than 80% compared with investment alternatives), Microsoft (Systems Software, USA) shares have much better financial characteristics than comparable stocks. Shares of Microsoft are a good value (attractively priced) with a consolidated Value Rank of 55 (better than 55% of alternatives), are safely financed (Safety Rank of 80, which means low debt burdens), but show below-average growth (Growth Rank of 47). ...read more

RECOMMENDATION: A Combined Rank of 80, is a strong buy recommendation based on Microsoft's financial characteristics. As the company Microsoft's key financial metrics exhibit good value (Obermatt Value Rank of 55) but low growth (Obermatt Growth Rank of 47) while being safely financed (Obermatt Safety Rank of 80), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 55% of comparable companies, may also indicate that the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity and the downside is limited due to below-average financing risks. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	55
Growth Rank	47
Safety Rank	80
Combined Rank	80

Country	USA
Industry	Systems Software
Index	Dow Jones, Dividends USA, Diversity USA, Human Rights, Renewables Users, Recycling, NASDAQ 100, NASDAQ, S&P 500
Size class	XX-Large

This stock has achievements: Top 10 Stock.

15-May-2025. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Microsoft

RESEARCH HISTORY	2022	2023	2024	2025
VALUE
VALUE	49	45	57	55
GROWTH
GROWTH	95	59	51	47
SAFETY
SAFETY	95	89	72	80
SENTIMENT
SENTIMENT	100	96	100	^new
360° VIEW
360° VIEW	100	100	86	^new

Most recent update of the stock research: 15-May-2025. Financial reporting date used for calculating ranks: 31-Dec-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Microsoft is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2022	2023	2024	2025
VALUE
VALUE	49	45	57	55
GROWTH
GROWTH	95	59	51	47
SAFETY
SAFETY	95	89	72	80
COMBINED
COMBINED	100	85	78	80

Last update of combined financial performance: 15-May-2025. Stock analysis on combined financial performance: The higher the rank of Microsoft the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 55 (better than 55% compared with alternatives), Microsoft shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Microsoft. Price-to-Profit (also referred to as price-earnings, P/E) is 51 which means that the stock price compared with what market professionals expect for future profits is lower than for 51% of comparable companies, indicating a good value concerning Microsoft's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 38, which means that the stock price is lower as regards to invested capital than for 38% of comparable investments. On the other hand, Price-to-Sales is less favorable than 81% of alternatives (only 19% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 15% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 55, is a buy recommendation based on Microsoft's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high in respect to expected revenues, it means that the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than pay it out to shareholders, thus sealing the company's fate early. Any investment optimism should only be a buy trigger once thorough research is completed. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2022	2023	2024	2025
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	13	12	19	19
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	50	45	59	51
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	31	34	34	38
DIVIDEND YIELD
DIVIDEND YIELD	80	83	85	85
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	49	45	57	55

Last update of Value Rank: 15-May-2025. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Microsoft; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 47 (better than 47% compared with alternatives), Microsoft shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Microsoft. Sales Growth has a rank of 60 which means that currently professionals expect the company to grow more than 60% of its competitors. Stock Returns are also above average with a rank of 57. But Capital Growth has only a rank of 49, which means that currently professionals expect the company to grow its invested capital less than 51% of its competitors. Profit Growth is also low, with a rank of only 48, which means that, currently, professionals expect the company to grow its profits below average. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 47, is a hold recommendation for growth and momentum investors. This is a surprising picture, as the messages from the operating growth indicators of revenues, profits, and invested capital are mixed, while stock returns are above average. It may indicate new intellectual properties, such as brand improvement or a strong market position that shows in revenues but not in the capital. The low profit-growth rate may indicate an early phase where costs are still high, and revenues don't fully cover upfront investments or fixed costs. The positive investor outlook with a 57% peer outperformance is reaffirmed in this case which may be a good sign for an investment into a well-protected high-growth company. This fact needs to be confirmed by researching the company website and press. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2022	2023	2024	2025
REVENUE GROWTH
REVENUE GROWTH	51	71	64	60
PROFIT GROWTH
PROFIT GROWTH	62	36	46	48
CAPITAL GROWTH
CAPITAL GROWTH	60	34	39	49
STOCK RETURNS
STOCK RETURNS	100	61	49	57
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	95	59	51	47

Last update of Growth Rank: 15-May-2025. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Microsoft.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 80 (better than 80% compared with alternatives) for 2025, the company Microsoft has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Microsoft is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above average for Microsoft. Leverage is at a rank of 58, meaning the company has a below-average debt-to-equity ratio. It has less debt than 58% of its competitors. Liquidity is also good at a rank of 85, meaning the company generates more profit to service its debt than 85% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 33, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 67% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 80 (better than 80% compared with alternatives), Microsoft has a financing structure that is significantly safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Microsoft. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. Investors may have a short-term debt challenge with Microsoft and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2022	2023	2024	2025
LEVERAGE
LEVERAGE	31	56	50	58
REFINANCING
REFINANCING	97	37	30	33
LIQUIDITY
LIQUIDITY	78	92	86	85
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	95	89	72	80

Last update of Safety Rank: 15-May-2025. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Microsoft and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2022	2023	2024	2025
ANALYST OPINIONS
ANALYST OPINIONS	n/a	93	89	^new
OPINIONS CHANGE
OPINIONS CHANGE	50	50	84	^new
PRO HOLDINGS
PRO HOLDINGS	97	78	97	^new
MARKET PULSE
MARKET PULSE	92	86	98	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	100	96	100	^new

Last update of Sentiment Rank: 15-May-2025. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Microsoft.
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