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Microsoft (MSFT) Dips More Than Broader Market: What You Should Know

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Microsoft (MSFT - Free Report) closed the latest trading day at $383.52, indicating a -1.33% change from the previous session's end. This change lagged the S&P 500's daily loss of 1.07%. Elsewhere, the Dow lost 0.62%, while the tech-heavy Nasdaq lost 1.71%.

Shares of the software maker have depreciated by 4.83% over the course of the past month, outperforming the Computer and Technology sector's loss of 11.12% and the S&P 500's loss of 7.03%.

The upcoming earnings release of Microsoft will be of great interest to investors. The company is forecasted to report an EPS of $3.20, showcasing an 8.84% upward movement from the corresponding quarter of the prior year. Our most recent consensus estimate is calling for quarterly revenue of $68.37 billion, up 10.52% from the year-ago period.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $13.08 per share and a revenue of $276.15 billion, representing changes of +10.85% and +12.66%, respectively, from the prior year.

Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Microsoft. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.09% higher. As of now, Microsoft holds a Zacks Rank of #3 (Hold).

From a valuation perspective, Microsoft is currently exchanging hands at a Forward P/E ratio of 29.72. This represents a premium compared to its industry's average Forward P/E of 25.46.

Also, we should mention that MSFT has a PEG ratio of 2.06. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. The Computer - Software industry had an average PEG ratio of 2.15 as trading concluded yesterday.

The Computer - Software industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 128, placing it within the top 50% of over 250 industries.

The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.


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