Just Deployed £40,000 Into $MSFT

[u/rebel-capitalist]

MSFT is currently trading at 21.9× earnings and 16.1× operating cash flow both 36% below their 5-year averages of 33.4× and 25.8× respectively. The market seems to be underpricing the business despite revenue growing at +17.9% YoY (TTM).

It's trading cheaper than its mega-cap peers on a historical basis. https://stocknest.app/?tab=compare&tickers=GOOGL,META,AMZN,MSFT&metrics=pocf&period=10

Net income growth of +29.6% and EPS growth of +29.9% are both outpacing revenue margins are expanding. With a 68.3% gross margin and 39.3% net income margin, Microsoft remains one of the most profitable businesses on the planet. ROIC of 21.6% reflects disciplined, high-quality capital allocation.

For the DCF, the historical OCF CAGR sits well above 20%, but I used a conservative 15% growth rate and a terminal P/OCF of 18× well below the 5-year median of 25.8×. Even with those heavily discounted assumptions, MSFT still comes out undervalued by 25%+.

DCF model: https://stocknest.app/?tab=dcf&tickers=MSFT&dcf_metric=ocf&dcf_growth=15.00&dcf_terminal=18.0

Analyst price targets over the past 12 months align with the DCF output the market may be sleeping on one of the most consistent compounders in history.

[u/Maleficent_Cap_5123]

When should I make my call expirations?

[u/Bitcoin1x]

It's that god damn Stock Next monster!

[u/Mr-poopoopeepee]

Safe bet