Analysts rate Microsoft Corporation (MSFT:NSD) Strong Buy, $358 Target

STA Research
by: STA Research
Microsoft Corporation

Analysts rate Microsoft Corporation with a consensus Strong Buy rating and a 12-month average target price of $357.91 per share.

STA Research rates Microsoft Corp. with a Strong Buy rating, and set the target on the company’s stock at $239.

Based on the Microsoft Corporation stock forecasts from 25 analysts, the average analyst target price for Microsoft Corporation is USD 357.91 over the next 12 months. Microsoft Corporation’s average analyst rating is Strong Buy. Stock Target Advisor’s own stock analysis of Microsoft Corporation is Slightly Bullish, which is based on 9 positive signals and 5 negative signals. At the last closing, Microsoft Corporation’s stock price was USD 288.50. Microsoft Corporation’s stock price has changed by -11.69% over the past week, -22.71% over the past month and +24.13% over the last year.

Microsoft Corporation develops, licenses, and supports software, services, devices, and solutions worldwide. It sells its products through OEMs, distributors, and resellers; and directly through digital marketplaces, online stores, and retail stores. It has collaborations with Dynatrace, Inc., Morgan Stanley, Micro Focus, WPP plc, ACI Worldwide, Inc., and iCIMS, Inc., as well as strategic relationships with Avaya Holdings Corp. and wejo Limited. Microsoft Corporation was founded in 1975 and is based in Redmond, Washington.

What we like:

High market capitalization

This is one of the largest entities in its sector and is among the top quartile. Such companies tend to be more stable.

Superior risk-adjusted returns

This stock has performed well, on a risk-adjusted basis, compared to its sector peers (for a hold period of at least 12 months) and is in the top quartile.

Low volatility

The stock’s annual returns have been stable and consistent compared to its sector peers (for a hold period of at least 12 months) and are in the top quartile. Although stability is good, also keep in mind it can limit returns.

Superior return on equity

The company management has delivered better return on equity in the most recent 4 quarters than its peers, placing it in the top quartile.

Superior capital utilization

The company management has delivered better return on invested capital in the most recent 4 quarters than its peers, placing it in the top quartile.

Superior return on assets

The company management has delivered better return on assets in the most recent 4 quarters than its peers, placing it in the top quartile.

Positive cash flow

The company had positive total cash flow in the most recent four quarters.

Positive free cash flow

The company had positive total free cash flow in the most recent four quarters.

Superior Earnings Growth

Compared to its sector, this stock has shown top quartile earnings growth in the previous 5 years.

What we don’t like:

Below median total returns

The company has underperformed its peers on annual average total returns in the past 5 years.

Overpriced compared to book value

The stock is trading high compared to its peers’ median on a price to book value basis.

Overpriced on a cash flow basis

The stock is trading high compared to its peers on a price to cash flow basis. It is priced above the median for its sectors. Proceed with caution if you are considering buying.

Highly leveraged

Compared to its sector peers on debt to equity, the company is in the bottom half and is highly leveraged. However, do check the news and look at its sector and management statements. Sometimes this is high because the company is trying to grow aggressively.

Overpriced on a free cash flow basis

The stock is trading high compared to its peers on a price to free cash flow basis. It is priced above the median for its sectors. Proceed with caution if you are considering buying.

 

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