XStocksXray

Research report · 16 October 2026

Microsoft Corp (MSFT)

Information Technology · Systems Software · US stock · price as of 16 Oct 2026

Key indicators

Price	$529.05
52-week range	$348.54 – $551.15
Market cap	$3.94T
P/E (trailing)	29.5×
EV / EBITDA	25.2×
Free-cash-flow yield	1.7%
Dividend yield	0.7%
Revenue (last 12 months)	$331.8B
Revenue growth (3y a year)	16.1%
Operating margin	46.8%
Return on invested capital	29.3%
Net debt / EBITDA	-0.1×

Fair value

Blended fair value$528.49 range $485 – $572

Versus priceFair−0% to fair value

Peer multiples	$593.93
Fundamentals-adjusted multiple	$409.59
10-year DCF (market-scaled)	$581.94
Earnings power value (floor, not blended)	$155.20
Model uncertainty	Medium

X-Ray Score

60/ 100 · High confidence · ahead of 81% of sector peers

Valuation53

Growth63

Profitability69

Financial health62

Dividends47

Five-year price chart navy: price · brown: 200-day average · blue band: fair value range

Executive summary

Microsoft is a global technology company that makes software, cloud services, devices and online platforms. Its main offerings include the Azure cloud platform, Windows, its Office productivity tools, Dynamics business applications, LinkedIn, Xbox gaming and Surface devices. Revenue comes from subscriptions, software licences, usage-based cloud fees, advertising and hardware sales, with business customers contributing a very large share of the total.

Sales reached $331.8 billion in the last twelve months, having grown 16.1% a year over the past three years. Operating profit equals 46.8% of revenue. Return on invested capital is 29%. Net debt to EBITDA is -0.1 times, which means the company holds more cash than debt. It pays a dividend, and the yield is 0.7%.

StocksXray gives Microsoft Corp an X-Ray Score of 60 out of 100 (high confidence), ahead of 81% of the S&P 500 stocks in its sector. Its strongest lens is profitability (69) and its weakest is dividends (47).

Our fair value blend is $528.49 (range $484.51 to $571.71). At $529.05 the stock trades 0% above that blend, so the label is "Fair" with medium model uncertainty. Fair value is a range, not a price target.

XStocksXray

Microsoft Corp (MSFT)

Valuation history multiples at each fiscal year-end price; the last column uses today's price and the last twelve months

	FY2022	FY2023	FY2024	FY2025	FY2026	Now
Price	$248.02	$332.04	$439.21	$492.54	$372.32	$529.05
Market cap	$1.87T	$2.48T	$3.28T	$3.68T	$2.77T	$3.94T
P/E	25.7×	34.3×	37.2×	36.1×	20.7×	29.5×
EV / revenue	9.2×	11.4×	13.3×	12.9×	8.3×	11.8×
EV / EBITDA	21.8×	27.3×	29.8×	28.2×	17.6×	25.2×
Price / free cash flow	28.7×	41.7×	44.3×	51.3×	41.4×	58.9×
Free-cash-flow yield	3.5%	2.4%	2.3%	1.9%	2.4%	1.7%
Price / book	11.2×	12.0×	12.2×	10.7×	6.3×	8.9×
Dividend yield	1.00%	0.82%	0.68%	0.67%	0.98%	0.69%

Fundamentals checklist ● 9 Good · ● 5 Average · ● 2 Bad · each check graded against the sector

Cash quality

Earnings backed by cash−6.5%Good

Free-cash-flow yield1.7%Bad

Risk models

Altman Z score4.6×Average

Piotroski F-Score6 of 9Average

Growth

EPS growth (3y)22.9%Good

Free-cash-flow growth (3y)4.0%Bad

Revenue growth (3y)16.1%Good

Growth consistency100%Good

Balance sheet

Current ratio1.2×Average

Net debt / EBITDA-0.1×Good

Interest coverno interest costGood

Valuation

Fair value vs price1.0×Good

EBIT / EV yield4.0%Average

Profitability

Return on invested capital29.3%Good

Operating margin46.8%Good

Gross profitability29.7%Average

XStocksXray

Microsoft Corp (MSFT)

Financials US$ millions, from SEC filings; last column is the last twelve months

Income statement	FY22	FY23	FY24	FY25	FY26	LTM
Revenue	198,270	211,915	245,122	281,724	331,839	331,839
Gross profit	135,620	146,052	171,008	193,893	225,465	225,465
Operating income	83,383	88,523	109,433	128,528	155,237	155,237
Net income	72,738	72,361	88,136	101,832	133,749	133,749
Diluted EPS ($)	9.65	9.68	11.80	13.64	17.95	17.94
Free cash flow	65,149	59,475	74,071	71,611	66,987	66,987
Gross margin	68.4%	68.9%	69.8%	68.8%	67.9%	67.9%
Operating margin	42.1%	41.8%	44.6%	45.6%	46.8%	46.8%
Net margin	36.7%	34.1%	36.0%	36.1%	40.3%	40.3%
Balance sheet	FY22	FY23	FY24	FY25	FY26	LTM
Total assets	364,840	411,976	512,163	619,003	758,376	758,376
Cash	13,931	34,704	18,315	30,242	20,935	20,935
Total debt	49,781	47,237	51,630	43,151	40,294	40,294
Equity	166,542	206,223	268,477	343,479	442,387	442,387
Dividend per share ($)	2.48	2.72	3.00	3.32	3.64	3.64

Revenue and net income US$ billions: navy revenue, teal net income

Margins blue gross, teal operating, brown net

Latest quarters

	Mar 2025	Jun 2025	Sep 2025	Dec 2025	Mar 2026	Jun 2026
Revenue ($M)	70,066	76,441	77,673	81,273	82,886	90,007
Growth vs a year earlier	+13.3%	+18.1%	+18.4%	+16.7%	+18.3%	+17.7%
Net income ($M)	25,824	27,233	27,747	38,458	31,778	35,766
Diluted EPS ($)	3.46	–	3.72	5.16	4.27	–

XStocksXray

Microsoft Corp (MSFT)

Peers in Systems Software

Company	X-Ray
MSFT · Microsoft Corp	60
GEN · Gen Digital Inc.	60
FTNT · Fortinet, Inc.	57
NOW · ServiceNow, Inc.	39
TWLO · Twilio Inc	39

Market Compass outlook for Information Technology: Favourable (75/100). It blends regime history, macro sensitivity, momentum and valuation.

Returns

1 week	−1.1%
1 month	+6.3%
3 months	+31.8%
6 months	+25.6%
1 year	+3.9%
3 years	+62.9%
5 years	+87.0%

Technical summary

DailyBullish10 bullish · 4 neutral · 2 bearish

WeeklyStrongly bullish11 bullish · 1 neutral · 0 bearish

MonthlyStrongly bullish7 bullish · 1 neutral · 0 bearish

50-day / 200-day average	$505.37 / $434.03
52-week low / high	$348.54 / $551.15
Classic pivot, support and resistance	S2 513.04 · S1 521.05 · P – · R1 540.44 · R2 551.82

Recent dividends

Ex-dividend date	Amount per share
19 Nov 2026	$0.9800
20 Aug 2026	$0.9100
21 May 2026	$0.9100
19 Feb 2026	$0.9100
20 Nov 2025	$0.9100
21 Aug 2025	$0.8300

XStocksXray

Microsoft Corp (MSFT)

Strengths

Return on invested capital of 29.3% is ahead of 67% of its sector peers.
Operating margin of 46.8% is ahead of 91% of its sector peers.
Revenue growth of 16.1% a year over three years is ahead of 78% of its sector peers.
Interest cover of no interest cost is ahead of 87% of its sector peers.
Holds more cash than debt (net debt to EBITDA of -0.1×).
Piotroski F-Score of 6 out of 9: most of the nine accounting health tests pass.
Has raised its dividend for 7 years in a row.

Risks and weak spots

Free-cash-flow yield is weak against Information Technology peers (1.7%).
Free-cash-flow growth (3y) is weak against Information Technology peers (4.0%).

Latest SEC filings

Date	Form	Items
2 Sep 2026	8-K	7.01,9.01
29 Jul 2026	10-K
29 Jul 2026	8-K	2.02,9.01
5 Jun 2026	8-K	5.02
14 May 2026	8-K	5.02,9.01
29 Apr 2026	10-Q
29 Apr 2026	8-K	2.02,9.01
28 Jan 2026	10-Q

How to read this report

Every number comes from SEC filings, end-of-day prices and the StocksXray models described on the methodology page. The X-Ray Score ranks each metric against the company's own sector. Fair value blends three models and carries a typical error of about 40%, so treat it as a range. Analyst ratings, price targets and earnings-call summaries are not part of this report. Educational research, not financial advice; read the disclaimer.