Financial statements analysis and stock valuation

Profitability Analysis
Quarterly Data

Measures the income of Microsoft Corp. relative to its revenues and invested capital.

• Ratios (Summary)
• Gross Profit Margin
• Operating Profit Margin
• Net Profit Margin
• Return on Equity (ROE)
• Return on Assets (ROA)

Common Stock Valuation Ratios
Quarterly Data

Relative valuation technique determine the value of Microsoft Corp. by comparing it to similar entities (like industry or sector) on the basis of several relative ratios that compare its stock price to relevant variables that affect the stock’s value, such as earnings, book value, and sales.

• Historical Valuation Ratios (Summary)
• Price to Earnings (P/E)
• Price to Operating Profit (P/OP)
• Price to Sales (P/S)
• Price to Book Value (P/BV)

Current Ratio
since 2005

Microsoft Corp.’s liquidity ratio calculated as current assets divided by current liabilities.

• Calculation
• Comparison to Competitors
• Comparison to Software & Computer Services Sector
• Comparison to Technology Industry

Price to FCFE (P/FCFE)

Free cash flow to equity is the cash flow available to Microsoft Corp.’s equity holders after all operating expenses, interest, and principal payments have been paid and necessary investments in working and fixed capital have been made.

• Free Cash Flow to Equity (FCFE)
• P to FCFE Ratio, Current
• P to FCFE Ratio, Historical

Enterprise Value to EBITDA (EV/EBITDA)

To calculate EBITDA analysts start with net earnings. To that earnings number, interest, taxes, depreciation, and amortization are added. EBITDA as a pre-interest number is a flow to all providers of capital.

• Earnings before Interest, Tax, Depreciation and Amortization (EBITDA)
• EV to EBITDA Ratio, Current
• EV to EBITDA Ratio, Historical

Statement of Cash Flows
Quarterly Data

The cash flow statement provides information about Microsoft Corp.’s cash receipts and cash payments during an accounting period, showing how these cash flaws link the ending cash balance to the beginning balance shown on Microsoft Corp.’s statement of financial position.