Microsoft stock: buy or sell?
Updated on:
December 6th, 2019
5
Microsoft Corporation develops, licenses, and supports software products, services, and devices worldwide. The company's Productivity and Business Processes segment offers Office 365 commercial products and services for businesses, including Office, Exchange, SharePoint, Skype for Business, and related Client Access Licenses (CALs); Office 365 consumer services, such as Skype, Outlook.
Should I buy Microsoft stock?
Even if you are a experienced or a novel trader, best trading results come from using an investing strategy that never leaves to random or subjective opinions when is the best moment to buy or sell stocks. That's why is so important to define your own trading plan that matches with your character as inversor. There are thousands of trading strategies for you to choose, but at Stocks2.com we prefer those that are simple but successful.Currently, Microsoft stock doesn't match any of these trading strategies, so our recommendation is not to buy.
| Buy setup | Elegible |
|---|---|
| New all-time high | No |
| New 52 week high | No |
| Price crossing up 200d MA | No |
| 100d MA crossing up 200d MA | No |
Is Microsoft stock a buy?
Everyday, hundreds of stock ratings are posted by financial analysts to indicate a particular stock's attractiveness.
At Stocks2.com, we collected 15 ratings published for MSFT stock in the last month. The general sentiment of these ratings is bullish for MSFT stock, with 14 positive ratings.| Date | Analyst / Broker | Previous rating | Current rating |
| 2019-9-4 | Credit Suisse Group | n/a | Buy |
| 2019-8-5 | Credit Suisse Group | n/a | Buy |
| 2019-8-29 | Wedbush | n/a | Outperform |
| 2019-8-26 | Credit Suisse Group | n/a | Buy |
| 2019-7-25 | Argus | n/a | Buy |
| 2019-7-24 | Royal Bank of Canada | n/a | Buy |
| 2019-7-19 | Stifel Nicolaus | n/a | Buy |
| 2019-7-19 | Raymond James | n/a | Strong-Buy |
| 2019-7-19 | Oppenheimer | n/a | Outperform |
| 2019-7-19 | Morgan Stanley | n/a | Overweight |
| 2019-7-19 | Morgan Stanley | n/a | Overweight |
| 2019-7-19 | Macquarie | n/a | Outperform |
| 2019-7-19 | KeyCorp | n/a | Overweight |
| 2019-7-19 | JPMorgan Chase & Co. | n/a | Buy |
| 2019-7-19 | JPMorgan Chase & Co. | n/a | Buy |
Microsoft stock analysis
Daily outlook
After reaching all time highs on November 27th, the Redmond company gained 1.21% to $151.75.
After topping to all time highs on Nov/27, the Redmond company gained 1.21% on December 6th to $151.75. MSFT shows a short term strength with several rising tops and rising bottoms. In the very short term, on Tuesday it marked a new bottom at $146.65 that should act a support if Microsoft starts a trading flat base in the range of $146.65 - $152.50 Trading the long side, we should wait to a new breakout over $152.50 to find the next buy point. Since last October when MSFT stock price broke up the SMA100d line, it gained $15.84 (11.65%). On November/27, MSFT hit new all time highs, pushing higher previous ATH of $152.42 recorded on Nov 26th. New ATHs are usual entry points for many trading setups as there aren't higher resistences.
Weekly outlook
The Redmond company shares remained steady 0.24% this week, ending at $151.75. This week was the 5th green week in a row.
Microsoft stock is trading in the range of its last top and last bottom. Loosing would mean breaking the current uptrend. Breakdowns under last bottom are selling point signals for some trading strategies. Not so far away is the last all-time high the Redmond company marked last week. Early February MSFT price bounced up over the SMA of 40 weeks that acted as support stopping new slides.
Microsoft stock price history
Microsoft IPO was on March 13th, 1986 at $0.06 per share1. Since then, MSFT stock grew a 252,816.70%, with a yearly average of 7,661.10%. If you had invested right after MSFT's IPO a $1,000 in Microsoft stock in 1986, it would worth $2,528,167.00 today.
1: Adjusted price after possible price splits or reverse-splits.
Microsoft stock historical price chart
MSFT stock reached all-time highs on Nov 27th with a price of $152.50.
Microsoft stock price target is $156.40
Predicting the price evolution of a stock or any financial instrument in a reliable and repeatable way is probably impossible. However, financial institutions invest time and resources to provide the most accurated estimations to help investors to make their decisions. The accuracy of these stock price predictions is not very high, and you should not blindly believe and make decisions only based on what this ratings or price target predictions say. For the last month we found 14 price predictions for the Redmond company stock:| Date | Analyst / Broker | Action | Previous target | Current target | Diff |
| 2019-9-4 | Credit Suisse Group | Set Price Target | n/a | $155.00 | - |
| 2019-8-5 | Credit Suisse Group | Set Price Target | n/a | $155.00 | - |
| 2019-8-26 | Credit Suisse Group | Set Price Target | n/a | $155.00 | - |
| 2019-7-25 | Argus | Raises Target | $5.26 | $158.00 | 2903.8% |
| 2019-7-24 | Royal Bank of Canada | Set Price Target | n/a | $153.00 | - |
| 2019-7-19 | Stifel Nicolaus | Raises Target | $150.00 | $155.00 | 3.3% |
| 2019-7-19 | Raymond James | Raises Target | $160.00 | $163.00 | 1.9% |
| 2019-7-19 | Oppenheimer | Raises Target | $145.00 | $160.00 | 10.3% |
| 2019-7-19 | Morgan Stanley | Reiterates | $145.00 | $155.00 | 6.9% |
| 2019-7-19 | Morgan Stanley | Raises Target | $145.00 | $155.00 | 6.9% |
| 2019-7-19 | Macquarie | Raises Target | $150.00 | $160.00 | 6.7% |
| 2019-7-19 | KeyCorp | Raises Target | $143.00 | $155.00 | 8.4% |
| 2019-7-19 | JPMorgan Chase & Co. | Set Price Target | n/a | $155.00 | - |
| 2019-7-19 | JPMorgan Chase & Co. | Reiterates | n/a | $155.00 | - |
| (in average) | $130.40 | $156.40 | 20.0% |
Financials and fundamental analysis
Earnings date and Earnings per Share
On January, the tech giant reported its latest financial data, close to analysts' consensus and posted a $1.10 Earnings per Share. As soon as we get its posted EPS from the earnings report, we will extend this report.| Quarter | Reporting date | Estimated EPS | Actual EPS | Surprise |
|---|---|---|---|---|
| 2017-Q2 | - | n/a | 0.86 | n/a |
| 2017-Q3 | 2017-10-26 | 0.72 | 0.84 | 16.7% |
| 2017-Q4 | 2018-01-31 | 0.87 | 0.96 | 10.3% |
| 2018-Q1 | 2018-04-26 | 0.85 | 0.95 | 11.8% |
| 2018-Q2 | 2018-07-19 | 1.07 | 1.13 | 5.6% |
| 2018-Q3 | 2018-10-24 | 0.96 | 1.14 | 18.8% |
| 2018-Q4 | 2019-01-30 | 1.09 | 1.1 | 0.9% |
| 2019-Q1 | - | n/a | n/a | n/a |
| 2019-Q2 | - | n/a | n/a | n/a |
| 2019-Q3 | - | n/a | n/a | n/a |
Annual financial results
In 2018, Microsoft annual sales boosted an outstanding 22.69% to $110,360.00 M USD from $89,950.00 marked in 2017. By contrast, its earnings margin (compared to revenues) eased to 15.02%, that is $16,571.00 million. Microsoft fiscal year ends in June, and to compare its evolution since then, we estimate annual sales and income figures by adding results from the last 4 quarters. This is called TTM (or Twelve Trailing Months). So, Microsoft TTM sales up to December 2018 were $118,459.00 and earnings $33,541.00 million dollars. If we compare this TTM figures with the last reported annuality, we can esteem the Redmond company business evolution since June 2018: Annual turnover up to December, compared to lastest yearly report, jumped a great 7.34%. Regarding profit margin, Microsoft skyrocketed 13.30% to 15.02%| Year | Sales | YoY | Income/(margin) | YoY |
|---|---|---|---|---|
| 2013 | $77,650 M | - | $21,860 M28.2% | - |
| 2014 | $86,730 M | 11.69% | $22,070 M25.4% | 0.96% |
| 2015 | $93,580 M | 7.90% | $12,193 M13.0% | -44.75% |
| 2016 | $91,154 M | -2.59% | $20,539 M22.5% | 68.45% |
| 2017 | $89,950 M | -1.32% | $21,204 M23.6% | 3.24% |
| 2018 | $110,360 M | 22.69% | $16,571 M15.0% | -21.85% |
| TTM | $118,459 M | 7.34% | $33,541 M28.3% | 102.41% |
Quarterly financial results
Microsoft reported $32,471.00 M in sales for 2018-Q4, a 11.65% up compared to previous quarter. Reported quarter income marked $8,420.00 M with a profit margin of 25.93%. Profit margin depreciated a -4.41% compared to previous quarter when profit margin was 30.34%. When comparing revenues to same quarter last year, Microsoft sales marked a super good gain and skyrocketed a 12.29%.| Quarter | Sales1 | QoQ2 | Income1/(margin) | QoQ2 |
|---|---|---|---|---|
| 2017-Q2 | $23,180 M | - | $6,510 M28.1% | - |
| 2017-Q3 | $24,430 M | 5.39% | $6,580 M26.9% | 1.08% |
| 2017-Q4 | $28,918 M | 18.37% | $-6,302 M-21.8% | -195.78% |
| 2018-Q1 | $26,819 M | -7.26% | $7,424 M27.7% | -217.80% |
| 2018-Q2 | $30,085 M | 12.18% | $8,873 M29.5% | 19.52% |
| 2018-Q3 | $29,084 M | -3.33% | $8,824 M30.3% | -0.55% |
| 2018-Q4 | $32,471 M | 11.65% | $8,420 M25.9% | -4.58% |
| 2019-Q1 | $30,571 M | -5.85% | $8,809 M28.8% | 4.62% |
Microsoft ownership
When you are planning to invest in shares of a stock, it's always worth to review its ownership structure.Microsoft shares owned by insiders (that is, founders, CEO, CTO, main executives or other management staff) currently counts a 1.41% of all shares.
In case of Microsoft stock, 74.70% of its shares are held by institutions (mutual funds, pension funds, big banks and other large financial institutions). Bearish positions for MSFT stock account 0.00%, no big difference from last month.
The following table compares ownership indicators for other stocks related to Microsoft:
| MSFT | AAPL | CSCO | GOOGL | HPQ | |
|---|---|---|---|---|---|
| Market cap | $1,168.5 B | $1,223.6 B | $185.9 B | $401.3 B | $30.3 B |
| Total shares | 7,700.0 M | 4,520.0 M | 4,240.0 M | 299.6 M | 1,480.0 M |
| Float shares | 7,520.0 M | 4,190.0 M | 4,240.0 M | 618.0 M | 1,480.0 M |
| - Institutional holdings (%) | 74.7% | 61.0% | 77.3% | 81.0% | 83.9% |
| - Insider holdings (%) | 1.4% | 0.1% | 0.1% | 0.2% | 0.2% |
| Shares in short selling | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% |
Microsoft summary
| Friday, December 6th, 2019 | |
|---|---|
| Open | $150.99 |
| Close | $151.75 |
| Day range | $150.27 - $151.87 |
| Previous close | $149.93 |
| Session gain | 1.21% |
| Average true range | $1.64 |
| 50d mov avg | $143.46 |
| 100d mov avg | $140.18 |
| 200d mov avg | $132.10 |
| Daily pattern | lb03a |
| Weekly pattern | lt06a |
Microsoft performance
To measure stock performance is always good to benchmark with competitors or related stocks. We compared Microsoft against Apple, Cisco Systems, Alphabet, HP, International Business Machines, Oracle and in the following table:| Stock | 3m | 6m | 12m |
|---|---|---|---|
| MSFTMicrosoft | 9.46% | 16.27% | 46.92% |
| AAPLApple | 27.32% | 43.34% | 63.08% |
| CSCOCisco Systems | -9.55% | -20.52% | -2.92% |
| GOOGLAlphabet | 11.03% | 25.37% | 27.98% |
| HPQHP | 8.24% | 5.72% | -7.70% |
| IBMInternational Bus... | -4.11% | 2.30% | 16.98% |
| ORCLOracle | 3.61% | 3.83% | 21.22% |
| SAP | 10.71% | 4.13% | 35.86% |
Microsoft competitors
We selected a few stocks to conform a list of Microsoft competitors to examine if you are interested in investing in MSFT:- Apple (AAPL)
- Cisco Systems (CSCO)
- Alphabet (GOOGL)
- HP (HPQ)
- International Business Machines (IBM)
- Oracle (ORCL)
- (SAP)
Latest Microsoft stock news
- InvestorPlaceMicrosoft Stock Is Worth a Buy … If You Wait for a DiscountAugust 1, 2019
- InvestorPlaceA Huge Second Quarter Is Just the Beginning for Microsoft StockJuly 30, 2019
- InvestorPlaceMicrosoft Earnings: The Big Story Everyone MissedJuly 30, 2019
- InvestorPlaceIs Microsoft Stock the Safest Trade in Big Tech Right Now?July 29, 2019
- Seeking AlphaWhy Microsoft Is Still The Best Tech Stock To Own Right NowJuly 25, 2019