Stock Analysis on Net

Microsoft Corp. (NASDAQ:MSFT)

$24.99

Enterprise Value to FCFF (EV/FCFF)

Microsoft Excel

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Free Cash Flow to The Firm (FCFF)

Microsoft Corp., FCFF calculation

US$ in millions

Microsoft Excel
12 months ended: Jun 30, 2023 Jun 30, 2022 Jun 30, 2021 Jun 30, 2020 Jun 30, 2019 Jun 30, 2018
Net income
Net noncash charges
Changes in operating assets and liabilities
Net cash from operations
Cash paid for interest on debt, net of tax1
Additions to property and equipment
Right-of-use assets obtained in exchange for finance lease obligations
Free cash flow to the firm (FCFF)

Based on: 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30), 10-K (reporting date: 2018-06-30).

Item Description The company
FCFF Free cash flow to the firm is the cash flow available to the Microsoft Corp. suppliers of capital after all operating expenses have been paid and necessary investments in working and fixed capital have been made. Microsoft Corp. FCFF increased from 2021 to 2022 but then slightly decreased from 2022 to 2023 not reaching 2021 level.

Interest Paid, Net of Tax

Microsoft Corp., interest paid, net of tax calculation

US$ in millions

Microsoft Excel
12 months ended: Jun 30, 2023 Jun 30, 2022 Jun 30, 2021 Jun 30, 2020 Jun 30, 2019 Jun 30, 2018
Effective Income Tax Rate (EITR)
EITR1
Interest Paid, Net of Tax
Cash paid for interest on debt, before tax
Less: Cash paid for interest on debt, tax2
Cash paid for interest on debt, net of tax

Based on: 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30), 10-K (reporting date: 2018-06-30).

1 See details »

2 2023 Calculation
Cash paid for interest on debt, tax = Cash paid for interest on debt × EITR
= × =


Enterprise Value to FCFF Ratio, Current

Microsoft Corp., current EV/FCFF calculation, comparison to benchmarks

Microsoft Excel
Selected Financial Data (US$ in millions)
Enterprise value (EV)
Free cash flow to the firm (FCFF)
Valuation Ratio
EV/FCFF
Benchmarks
EV/FCFF, Competitors1
Accenture PLC
Adobe Inc.
Autodesk Inc.
CrowdStrike Holdings Inc.
International Business Machines Corp.
Intuit Inc.
Oracle Corp.
Palo Alto Networks Inc.
Salesforce Inc.
ServiceNow Inc.
Synopsys Inc.
EV/FCFF, Sector
Software & Services
EV/FCFF, Industry
Information Technology

Based on: 10-K (reporting date: 2023-06-30).

1 Click competitor name to see calculations.

If the company EV/FCFF is lower then the EV/FCFF of benchmark then company is relatively undervalued.
Otherwise, if the company EV/FCFF is higher then the EV/FCFF of benchmark then company is relatively overvalued.


Enterprise Value to FCFF Ratio, Historical

Microsoft Corp., historical EV/FCFF calculation, comparison to benchmarks

Microsoft Excel
Jun 30, 2023 Jun 30, 2022 Jun 30, 2021 Jun 30, 2020 Jun 30, 2019 Jun 30, 2018
Selected Financial Data (US$ in millions)
Enterprise value (EV)1
Free cash flow to the firm (FCFF)2
Valuation Ratio
EV/FCFF3
Benchmarks
EV/FCFF, Competitors4
Accenture PLC
Adobe Inc.
Autodesk Inc.
CrowdStrike Holdings Inc.
International Business Machines Corp.
Intuit Inc.
Oracle Corp.
Palo Alto Networks Inc.
Salesforce Inc.
ServiceNow Inc.
Synopsys Inc.
EV/FCFF, Sector
Software & Services
EV/FCFF, Industry
Information Technology

Based on: 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30), 10-K (reporting date: 2020-06-30), 10-K (reporting date: 2019-06-30), 10-K (reporting date: 2018-06-30).

1 See details »

2 See details »

3 2023 Calculation
EV/FCFF = EV ÷ FCFF
= ÷ =

4 Click competitor name to see calculations.

Valuation ratio Description The company
EV/FCFF Enterprise value to free cash flow to the firm is whole company valuation indicator. Microsoft Corp. EV/FCFF ratio decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.