In April 1975, Bill Gates and Paul Allen established Microsoft, one of the world leaders in the computer software industry.
The company went public in March 1986, with a share price of $21. More than 2.5 million shares were traded on the IPO day. Today, institutional investors own over 65% of the company’s shares. The percentage is higher than in most companies in the packaged software industry. The stock price is quite low, and Microsoft Corporation pays a cash dividend that has been growing for years. The earnings and revenue growth have been stable over the years. The return-on-equity metric reflects Microsoft’s durable competitive advantage, as the ROE has been stable for several years. The return-on-assets and return-on-capital employed metrics have been above the industry’s average. The company’s earnings have been higher than the US software - infrastructure industry average. Still, the revenue is lower than the average rate of the US software — infrastructure industry.
Microsoft has been involved in numerous legal issues, including cases against the US, EU, and competitors. High-profile court cases often lead to enormous fines and sanctions the company pays to settle the deal. It affects not only its financial state but also the stock price. That’s why CFD trading may be a better option when dealing with MSFT stocks. CFD trading allows traders to benefit from increases and decreases in the share price.
Although Microsoft is one of the market leaders, it has competitors. Their performance may affect the success of the company’s products. The key rivals are Dell, Salesforce, Apple, Meta, Zoom, Slack, Cisco, SAP, Sony, and Hewlett Packard Enterprise. Microsoft is included in numerous world stock indices. The major ones are Nasdaq 100, S&P 500, Dow Jones, and Nasdaq.
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Sell | 417.14 |
Buy | 417.32 |
Sentiment | 92.3% ▾ |
1-day change | -9.69(-2.27%) |
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Since the IPO, Microsoft's stock price has reached almost $15000 (including splits). That is, they increased in price by 71283%. Impressive result! If an investor acquired the corporation's assets in 1986, did not sell them and reinvested all dividends, then the yield is + 379711%.
Announcements of new Microsoft products are a milestone event for investors. For example, in 2021, before the official presentation of Windows 11, the stock price grew significantly, and the company's capitalization exceeded $2 trillion.
The corporation's value could have been even higher if Microsoft had not sold its stake in Apple. In 1997, Bill Gates' company invested $150 million in its main competitor to save Apple from bankruptcy. Microsoft held APPL shares for three years. The proceeds from the sale of assets amounted to $550 million. However, it could be several times more since Apple shares have risen in price by 850 times since 1997. Thus Windows could receive $127.5 billion.
In addition to Apple, Bill Gates' company at various times owned shares in other companies, including Toyota Media Service Corp, Facebook, Corel Corporation, etc. In recent years, Microsoft has been actively acquiring other companies. The largest acquisitions are the professional social network LinkedIn ($26.2 billion), the provider of Internet hosting for software development GitHub ($7.5 billion), and Nokia's devices and services division ($7.2 billion). News about future acquisitions pushes the MSFT price up.
Microsoft is also among the top 5 patent holders in the United States. The corporation's intellectual property portfolio includes more than 10000 titles. The list continues to grow.
Explore a detailed forecast for Microsoft (MSFT) stock. Expert analysis and yearly outlook inside!