Microsoft (MSFT - Free Report) closed the most recent trading day at $114.59, moving +0.08% from the previous trading session. This change outpaced the S&P 500's 0.09% loss on the day. At the same time, the Dow added 0.03%, and the tech-heavy Nasdaq lost 0.16%.
Coming into today, shares of the software maker had gained 7.2% in the past month. In that same time, the Computer and Technology sector gained 4.21%, while the S&P 500 gained 2.35%.
MSFT will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $1, up 5.26% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $29.83 billion, up 11.24% from the year-ago period.
MSFT's full-year Zacks Consensus Estimates are calling for earnings of $4.41 per share and revenue of $123.87 billion. These results would represent year-over-year changes of +13.66% and +12.24%, respectively.
It is also important to note the recent changes to analyst estimates for MSFT. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Our research shows that these estimate changes are directly correlated with near-term stock prices. 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 ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.05% lower. MSFT currently has a Zacks Rank of #3 (Hold).
In terms of valuation, MSFT is currently trading at a Forward P/E ratio of 25.97. This represents a discount compared to its industry's average Forward P/E of 30.05.
It is also worth noting that MSFT currently has a PEG ratio of 2.1. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Computer - Software was holding an average PEG ratio of 2.13 at yesterday's closing price.
The Computer - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 21, putting it in the top 9% of all 250+ industries.
The Zacks Industry Rank includes is listed in order 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.
You can find more information on all of these metrics, and much more, on Zacks.com.