Price to FCFE (P/FCFE)
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- Analysis of Short-term (Operating) Activity Ratios
- Analysis of Long-term (Investment) Activity Ratios
- Capital Asset Pricing Model (CAPM)
- Operating Profit Margin since 2005
- Return on Equity (ROE) since 2005
- Return on Assets (ROA) since 2005
- Total Asset Turnover since 2005
- Price to Earnings (P/E) since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Book Value (P/BV) since 2005
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Free Cash Flow to Equity (FCFE)
Microsoft Corp., FCFE calculation
US$ in millions
Based on: 10-K (reporting date: 2024-06-30), 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).
- Net Cash from Operations
- The net cash from operations demonstrated a consistent upward trend over the observed period. Starting from $52,185 million in June 2019, the amount increased steadily each year, reaching $118,548 million by June 2024. This reflects strong operational cash-generating capability and an overall positive cash flow trajectory, with a notable acceleration in growth particularly between the years 2023 and 2024.
- Free Cash Flow to Equity (FCFE)
- Free cash flow to equity also exhibited growth throughout the period, beginning at $34,260 million in June 2019 and rising to $74,646 million by June 2024. The increase was relatively steady annually, with significant jumps observed in the periods between 2020 to 2021 and 2023 to 2024. The FCFE's trend suggests improving availability of cash that could be returned to shareholders, indicative of healthy financial management and sustained profitability.
- Summary and Insights
- Overall, both net cash from operations and free cash flow to equity have shown consistent positive trends, with net cash from operations growing at a slightly faster pace. The stability and growth in operational cash flow underpin the firm’s capability to generate liquidity and fund its activities. The increasing FCFE highlights the potential for enhanced shareholder value through dividends or share repurchases. The data points toward strengthened financial health and an expanding cash base over the five-year timeline, signifying effective operational and financial strategies.
Price to FCFE Ratio, Current
Microsoft Corp., current P/FCFE calculation, comparison to benchmarks
| No. shares of common stock outstanding | |
| Selected Financial Data (US$) | |
| Free cash flow to equity (FCFE) (in millions) | |
| FCFE per share | |
| Current share price (P) | |
| Valuation Ratio | |
| P/FCFE | |
| Benchmarks | |
| P/FCFE, Competitors1 | |
| Accenture PLC | |
| Adobe Inc. | |
| Cadence Design Systems Inc. | |
| CrowdStrike Holdings Inc. | |
| Fair Isaac Corp. | |
| International Business Machines Corp. | |
| Intuit Inc. | |
| Oracle Corp. | |
| Palantir Technologies Inc. | |
| Palo Alto Networks Inc. | |
| Salesforce Inc. | |
| ServiceNow Inc. | |
| Synopsys Inc. | |
| Workday Inc. | |
| P/FCFE, Sector | |
| Software & Services | |
| P/FCFE, Industry | |
| Information Technology | |
Based on: 10-K (reporting date: 2024-06-30).
1 Click competitor name to see calculations.
If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.
Price to FCFE Ratio, Historical
Microsoft Corp., historical P/FCFE calculation, comparison to benchmarks
| Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | Jun 30, 2020 | Jun 30, 2019 | ||
|---|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | |||||||
| Selected Financial Data (US$) | |||||||
| Free cash flow to equity (FCFE) (in millions)2 | |||||||
| FCFE per share3 | |||||||
| Share price1, 4 | |||||||
| Valuation Ratio | |||||||
| P/FCFE5 | |||||||
| Benchmarks | |||||||
| P/FCFE, Competitors6 | |||||||
| Accenture PLC | |||||||
| Adobe Inc. | |||||||
| Cadence Design Systems Inc. | |||||||
| CrowdStrike Holdings Inc. | |||||||
| Fair Isaac Corp. | |||||||
| International Business Machines Corp. | |||||||
| Intuit Inc. | |||||||
| Oracle Corp. | |||||||
| Palantir Technologies Inc. | |||||||
| Palo Alto Networks Inc. | |||||||
| Salesforce Inc. | |||||||
| ServiceNow Inc. | |||||||
| Synopsys Inc. | |||||||
| Workday Inc. | |||||||
| P/FCFE, Sector | |||||||
| Software & Services | |||||||
| P/FCFE, Industry | |||||||
| Information Technology | |||||||
Based on: 10-K (reporting date: 2024-06-30), 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).
1 Data adjusted for splits and stock dividends.
3 2024 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= ÷ =
4 Closing price as at the filing date of Microsoft Corp. Annual Report.
5 2024 Calculation
P/FCFE = Share price ÷ FCFE per share
= ÷ =
6 Click competitor name to see calculations.
- Share Price Trend
- The share price has shown a consistent upward trend over the analyzed period, increasing from $138.06 in mid-2019 to $422.92 in mid-2024. Notably, there was a substantial rise between 2019 and 2021, followed by a slight dip in 2022, before resuming a strong upward trajectory through 2023 and 2024.
- Free Cash Flow to Equity (FCFE) per Share
- FCFE per share exhibits an overall increasing trend, beginning at $4.49 in 2019 and reaching $10.04 by 2024. The growth has been relatively steady, with particularly strong increases observed from 2020 onward, indicating improving cash generation available to equity shareholders.
- Price to FCFE Ratio (P/FCFE)
- The P/FCFE ratio presents some fluctuations, ranging from a low of 30.77 in 2019 to a high of 43.32 in 2023. After peaking in 2020 and 2021 at around 42.7, the ratio decreased in 2022 to approximately 36.73 before climbing again in 2023 and slightly decreasing in 2024 to 42.11. This indicates varying market valuation multiples relative to the company's free cash flow per share over time.
- Overall Interpretation
- The data reveals robust growth in both market valuation and underlying cash flow metrics. While the share price and FCFE per share have generally increased, the P/FCFE ratio's fluctuations suggest changing investor sentiment or market conditions impacting the premium placed on the company's cash flow. The steady rise in FCFE per share supports the view of improving operational cash generation, while the generally elevated P/FCFE in recent years indicates sustained investor confidence in the company's future free cash flow potential.