Microsoft MSFT
Microsoft is a technology company that develops and sells software (Windows, Office), cloud services (Azure), hardware (Surface, Xbox), and artificial intelligence solutions, generating recurring revenue through subscriptions and enterprise contracts. Microsoft combines solid growth (revenue +17.7%) with exceptional profitability (ROE 34.04%), although its valuation is demanding (P/E 28.74) and the FCF yield is low (0.43).
Detailed metrics
Market and fundamental data as of the analysis date.
Full AI report
Generated automatically from the metrics, the macro context and the company's news.
Microsoft is a technology company that develops and sells software (Windows, Office), cloud services (Azure), hardware (Surface, Xbox), and artificial intelligence solutions, generating recurring revenue through subscriptions and enterprise contracts. Microsoft combines solid growth (revenue +17.7%) with exceptional profitability (ROE 34.04%), although its valuation is demanding (P/E 28.74) and the FCF yield is low (0.43).
Score by category
| Category | Score |
|---|---|
| Financial health | 7.8 |
| Quality / Moat | 7.3 |
| Valuation | 4.5 |
| Growth | 8.2 |
| Dividend | 4.4 |
| Momentum | 4.5 |
| Risk & Context | 5.3 |
OVERALL SCORE: 6.3/10
Context and risks
The rise in 10-year Treasury yields (5.17%) and the risk premium on tech stocks due to geopolitical tensions (US-Iran standoff) pressure the valuation of long-duration stocks like Microsoft. However, its solid balance sheet (ND/EBITDA of 0.27) and pricing power mitigate the impact.
News considered in the analysis
- The AI gold rush is fueling a record tech bond boom: Chart of the Day — El auge de la emisión de deuda tecnológica para financiar IA es un viento de cola para el balance de Microsoft, que puede emitir a costes atractivos para financiar su expansión en centros de datos.
- Microsoft Corporation (MSFT) Wants AI to Do More. Can Customers Keep Up? — La presión por monetizar la IA es un riesgo conocido, pero la capacidad de Microsoft para integrar IA en su suite de productividad (Copilot) sugiere que puede capturar valor, aunque la adopción por parte de los clientes es incierta.
- Bill Gates warns AI global framework talks harder than Cold War-era nuclear negotiations — Las advertencias sobre la regulación de la IA podrían generar incertidumbre regulatoria, pero el impacto directo en los beneficios de Microsoft es limitado a corto plazo.
- Microsoft (MSFT) Reportedly Plans a Vast Data Center Expansion. Can Azure Justify the Cost? — La expansión masiva de centros de datos es una inversión material que podría presionar los márgenes a corto plazo, pero es necesaria para capturar la demanda de IA y mantener el liderazgo de Azure. El mercado ya lo descuenta en parte.
- Michael Burry just put a date on Big Tech's AI reckoning, and Oracle's $664 billion lands in crosshairs — La advertencia de Michael Burry sobre una posible burbuja de IA podría aumentar la volatilidad, pero es una opinión especulativa sin impacto directo en los fundamentales de Microsoft.
Verdict: Maintain position; the strength of the business offsets the valuation, but the risk of rising rates and the high comparison base limit the upside potential in the short term.
Main risk: The main risk is the high valuation (P/E 28.74) in a rising rate environment, which could compress the multiple if growth decelerates or if AI spending does not generate the expected return.
Other Technology companies
Neighbours in the sector ranking, to compare without going back to the index.
See all 1,000+ companies in the index →