On this article, I’ll share with you my first stock analysis ! I made a short video (available on tiktok and youtube) in which I dive into MSFT stock. You can also download this pdf in which you’ll see my thorough analysis and why I gave a rating of 9,26/10.
Here the video transcription :
Is Microsoft a wise investment choice at the moment?
Well, there is only one way to find out, it’s to check the fundamental data.
Let’s begin with Revenue and Net Income. Over the past decade, both metrics have shown consistent growth. Specifically, Microsoft has enjoyed an average annual revenue increase of 10% and a net income surge of 21%.
Regarding profit margins, Microsoft has consistently maintained impressive figures, exceeding 20% for several years. In 2023, the net margin reached a remarkable 34%.
Another aspect to consider is the reduction in outstanding shares, achieved through strategic buyback programs. This initiative inherently enhances the value of remaining stocks.
Focusing now on Free Cash Flows, Microsoft has not only sustained positive numbers but has also seen a substantial increase, hitting approximately $60 billion in 2023.
In terms of dividend distribution, there’s been a noticeable, steady escalation, with a payout ratio always at safe level, even dipping below 50% since 2019.
Now, let’s see Microsoft’s stock performance. In comparison to the Nasdaq 100 index, Microsoft has outperformed it 9 times over the last 10 years, marking it as a top performer within the index.
Turning to MorningStar’s insights, they appraise the stock at $370 and acknowledge Microsoft’s wide economic moat. Microsoft is therefore slightlighty overvalued right now.
In summary, Microsoft has consistently outpaced the reference index over the past decade, demonstrating robust revenue, net income, and Free Cash Flows. The profit margins have remained strong, and the reduction in share count further bolsters the stock’s fundamental appeal.
On this basis, I assign a rating of 8.52 out of 10, reflecting the various assessments I’ve conducted.
Remember, this is just a glimpse into the 27 criteria I use for company evaluation.
For a comprehensive analysis, you can visit thedividendprince.com. Here, you can download a detailed PDF version of my findings.
If you found this video informative, please give it a like or a comment, and don’t forget to follow or subscribe for more insights.
Thank you, and I look forward to sharing more analyses with you soon.
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