Microsoft Corporation
MSFT$378.91
-$1.24(-0.33%)
Overview
Trading Stats
Open$380.50
Day Range$377.23 - $382.15
52W Range$275.37 - $420.82
Volume21.5M
Market Cap2.8T
Price History
Financials
P/E Ratio
35.20
P/B Ratio
N/A
P/S Ratio
N/A
ROE
+25.00%
ROA
+10.00%
Profit Margin
+20.00%
Op. Margin
N/A
Gross Margin
N/A
Revenue Growth
+10.00%
Earnings Growth
N/A
D/E Ratio
0.50
Current Ratio
1.50
Profitability Margins
Gross: 0.0%
Operating: 0.0%
Net: 20.0%
Financial Health Score
Higher scores indicate better financial health
Valuation Analysis
Fair Value Estimate
$186.51-50.8% upside
Potentially Overvalued
Based on 1 valuation methods
DCF
$186.51
-50.8%
Microsoft Corporation (MSFT)
DCF Valuation Analysis
Potentially Overvalued
-50.8% from current price
Intrinsic Value
$186.51
Market Price
$378.91
WACC
+10.00%
Enterprise Value
1.4T
Key Assumptions
Revenue Growth (Y1)
+10.00%
Terminal Growth
+2.50%
Target Op Margin
+15.00%
Beta
1.00
Projected Free Cash Flows
| Year | Revenue | Growth | FCF | PV of FCF |
|---|---|---|---|---|
| Year 1 | 1T | +10.00% | 86.2B | 78.4B |
| Year 2 | 1.1T | +8.75% | 95B | 78.5B |
| Year 3 | 1.2T | +7.50% | 103.4B | 77.7B |
| Year 4 | 1.3T | +6.25% | 111.2B | 76B |
| Year 5 | 1.3T | +5.00% | 118.3B | 73.5B |
| Terminal Value (PV) | +2.50% perpetuity | 1T | ||
Enterprise to Equity Value Bridge
Sum of PV (FCF)384B
+ PV of Terminal Value1T
Enterprise Value1.4T
− Net Debt(0)
Equity Value1.4T
Shares Outstanding7.4B
Intrinsic Value / Share$186.51
Sensitivity Analysis: Intrinsic Value per Share
Values show how intrinsic value changes with different WACC and terminal growth assumptions
| WACC ↓ / Growth → | +1.50% | +2.00% | +2.50% | +3.00% | +3.50% |
|---|---|---|---|---|---|
| +8.00% | $223.46 | $238.45 | $256.15 | $277.40 | $303.37 |
| +9.00% | $192.86 | $203.58 | $215.96 | $230.40 | $247.47 |
| +10.00% | $169.48 | $177.46 | $186.51 | $196.85 | $208.78 |
| +11.00% | $151.04 | $157.16 | $164.01 | $171.71 | $180.44 |
| +12.00% | $136.13 | $140.94 | $146.26 | $152.17 | $158.77 |
Understanding This DCF
- Terminal Value represents +72.33% of Enterprise Value — typical for DCF models (60-80%)
- The model uses a +10.00% WACC based on CAPM with beta of 1.00
- Small changes in assumptions significantly impact value — always use a range, not a single number
Educational Purposes Only. This DCF model uses simplified assumptions and publicly available data. Real valuations require detailed financial analysis, industry expertise, and consideration of many factors not captured here. Never make investment decisions based solely on this analysis.