Stock fact sheet · data as of
Microsoft Corporation (MSFT): fair value, margin of safety and Wheel Score
Ticker symbol MSFT · Technology · Software - Infrastructure · United States · Growth
Is MSFT undervalued?
At 555.80 (close of 5 Nov 2026), MSFT trades 23% over the GLS average fair value of 452.78. 2 of the 9 models land above the price and 7 below. A negative margin of safety fails the "below fair value" Wheel Trade Filter - the models see no discount, which does not make the business a poor one, only the price a full one.
The 9 models disagree widely: DDM gives 53.56 while GLS Growth gives 1,175.85. A spread that wide means the average is sensitive to which methods you trust; the model table below shows where each one lands, and the Quote page lets you switch any of them off.
Ranked against every other company we cover, MSFT is clearly faster-growing than it is cheap, so the nightly engine files it under Growth (value score 18, growth score 80, out of 100).
Nine valuation models for MSFT
Each model turns the latest filed numbers into a value per share; the GLS fair value is the simple average of the ones that produce a positive number. The last two rows are shown for reference and never enter the average. The Quote page lets you switch any model off and add your own margin of safety.
| Model | Value | vs price | What it measures |
|---|---|---|---|
| DCF | 300.43 | -46% | Present value of the projected free cash flows, discounted at the cost of capital |
| Graham Number | 165.47 | -70% | The most a defensive investor pays for the earnings and book value per share |
| Graham Growth | 1,034.00 | +86% | Graham's growth formula: EPS × (8.5 + 2 × growth), adjusted for bond yields |
| Lynch | 447.12 | -20% | EPS × the earnings growth rate (PEG of 1), growth capped at 25% |
| GLS Growth | 1,175.85 | +112% | EPS compounded ten years at the blended growth rate, discounted back at 15% a year |
| 10 Cap | 365.44 | -34% | Owner's earnings (operating cash flow less maintenance capex) capitalised at 10% |
| Payback Time | 319.71 | -42% | Eight years of compounded free cash flow: the price at which the business pays for itself |
| DDM | 53.56 | -90% | Dividend discount model: next year's dividend ÷ (10% − 3% growth); needs a dividend |
| EPV | 213.41 | -62% | Earnings power value: current EPS capitalised at 9% with no growth |
| Zombie (liquidation) | -14.58 | -103% | Current assets less all liabilities, per share: the balance-sheet floor. Not in the average |
| Wall St target | 611.74 | +10% | Analysts' average 12-month price target. Not in the average |
Quality and financial health
Financial health is average - MSFT passes 6 of the nine Piotroski tests, which passes the "Piotroski 6 or more" Wheel Trade Filter. The Financials tab on the Quote page shows which tests fail. The GLS Moat score is 9.5 out of 10 - high returns on capital, steady margins and growth that held up through bad years point to a durable business.
Returns on capital are high - ROIC 23.4%, ROE 30.2%, ROA 17.6% - with debt at 0.29 times equity and a free-cash-flow yield of 1.5%.
The dividend yield is 0.65% with a payout ratio of 19% - a small yield that leaves most of the earnings in the business. Revenue comes mainly from Server products and cloud services 41%, Microsoft 365 Commercial products and c… 31%, Linked In 6% (quarter Q4 FY2026).
Institutional ownership scores 9/10, insider activity 1/10 and Congressional trading 4/10 on the GLS smart-money scales; the last recorded Congressional buy was on 30 Sep 2026.
| Piotroski F-score | 6 / 9 | ROIC | 23.4% |
|---|---|---|---|
| GLS Moat | 9.5 / 10 | ROE | 30.2% |
| Debt / equity | 0.29 | ROA | 17.6% |
| Free-cash-flow yield | 1.5% | Payout ratio | 19% |
| Institutions | 9 / 10 | Insiders · Congress | 1 · 4 / 10 |
Wheel Score 43: Weak
MSFT scores 43 out of 100 on the Wheel Score, in the Weak band (under 50): it fails filter 3, below fair value - trades 23% above our fair value, and the parts are thin too - value weak, premium fair, moat strong, health good, red flags good, option trading strong, stability strong. The score is not a judgement on the company; it says the price, quality and premium do not line up for selling puts on it today.
Implied volatility is 29% on the near-the-money contracts 20-60 days out: enough to pass the 25-80% Wheel Trade Filter, but under the 35-60% sweet spot the score rewards most. The option chain is deep: 2,185,748 contracts of open interest across all expiries, which means tight fills at most strikes.
Volume runs at 50.7M shares a day on a market cap of $4.13T, with a beta of 1.04; the Stability part of the Wheel Score rates that strong.
| Filter | Wheel Trade Filter | Result | Detail |
|---|---|---|---|
| 1 | Options that actually trade | Passes | Listed options with 1,000+ contracts of open interest and 100+ traded a day |
| 2 | A real business, not a gamble | Passes | Profitable over the last twelve months - not a speculative stock, fund or note |
| 3 | Below fair value | Fails | trades 23% above our fair value |
| 4 | Financially healthy | Passes | Piotroski F-score 6 or more out of 9 (a company with no score on file passes) |
| 5 | Can repay its debt | Passes | Long-term debt repaid from 3 years of operating cash flow or less (6 for real estate and utilities; banks and insurers are not judged on it) |
| 6 | No serious red flags | Passes | Red Flags score 60 or more out of 100 (earnings, margins, debt, analysts, filings and price checked the same way for every stock) |
| 7 | A premium worth selling | Passes | Implied volatility 25-80% (enough premium, not a lottery ticket) |
| 8 | Big enough | Passes | Market cap $1 billion or more |
| 9 | Not a penny stock | Passes | Share price $5 or more |
| How it ranks | Rating | From | |
|---|---|---|---|
| Value | Weak | 23% above fair value | |
| Premium | Fair | implied volatility 29% | |
| Moat | Strong | moat 9.5/10 | |
| Health | Good | Piotroski 6/9 | |
| Red Flags | Good | Red Flags score 87/100 | |
| Option trading | Strong | 460,234 contracts a day, 2,185,748 open interest | |
| Stability | Strong | beta 1.04, $4.13T company |
The Wheel Score ranks ~7,400 US stocks for selling cash-secured puts and covered calls: a stock must pass all 9 Wheel Trade Filters to score 70, and the score then ranks the ones that pass; the Sunday Scan is the top 10. It is updated nightly and is not a recommendation. How the Wheel Score works · the walkthrough lesson shows how it fits into a trade, start to finish.
Upcoming events
The next earnings report is due on 27 Jan 2027, 83 days away - outside the window of a 30-45-day put sold today. The shares go ex-dividend on 19 Nov 2026 (0.9800 per share), so a covered call sold before then carries a small early-assignment risk around that date.
In the last 30 days analysts logged 4 upgrades and 5 downgrades on MSFT; the latest action was a reiterated rating by Cantor Fitzgerald on 29 Oct 2026.
Earnings, dividend, IPO, split and economic calendars for the whole market, filterable to your watchlists.
Similar stocks in Software - Infrastructure
The 12 companies below are the closest to Microsoft Corporation by market cap within the Software - Infrastructure industry, each with its own fact sheet; the Compare page puts up to eight of them side by side.
| Stock | Close | Fair value | MoS | Wheel | Mkt cap |
|---|---|---|---|---|---|
| PLTR Palantir Technologies Inc. | 171.70 | 44.86 | -283% | 47Weak | $395.0B |
| ORCL Oracle Corporation | 123.77 | 178.67 | +31% | 55Fair | $374.2B |
| PANW Palo Alto Networks, Inc. | 348.04 | 38.89 | -795% | 37Weak | $284.9B |
| CRWD CrowdStrike Holdings, Inc. | 241.00 | 7.10 | -3295% | 41Weak | $246.8B |
| FTNT Fortinet, Inc. | 129.39 | 81.43 | -59% | 50Fair | $95.1B |
| NET Cloudflare, Inc. | 266.82 | 17.03 | -1467% | 31Weak | $95.0B |
| SNPS Synopsys, Inc. | 462.95 | 257.05 | -80% | 44Weak | $88.7B |
| BSQKZ Block, Inc. | 89.11 | 45.91 | -94% | 20No options | $48.2B |
| XYZ Block, Inc. | 87.61 | 45.40 | -93% | 37Weak | $47.4B |
| ZS Zscaler, Inc. | 224.44 | 107.75 | -108% | 34Weak | $36.6B |
| TWLO Twilio Inc. | 213.50 | 199.26 | -7% | 40Weak | $33.0B |
| OKTA Okta, Inc. | 191.05 | 82.21 | -132% | 39Weak | $31.9B |
Scan the whole market the same way
A free GLS Equity account gets you nightly fair value and the Wheel Score on ~7,400 US stocks, a watchlist, the scanner preview and the Sunday Scan - the top 10 stocks that pass all 9 Wheel Trade Filters, emailed every week. Pro adds the full put and call scanners, unlimited watchlists with alerts and the trade journal.
Start free See the Sunday ScanQuestions about MSFT
Is MSFT undervalued right now?
No: at 555.80 the stock trades 23% above the GLS average fair value of 452.78 (data as of 5 Nov 2026). The margin of safety is negative.
What is the Wheel Score of MSFT and what does it mean?
MSFT scores 43 out of 100 (Weak) - it fails Wheel Trade Filter 3. The Wheel Score ranks stocks for the wheel strategy - selling cash-secured puts, then covered calls if assigned - in two parts: the 9 pass/fail Wheel Trade Filters (busy options, a real business, below fair value, Piotroski 6 or more, debt it can repay, a Red Flags score of 60 or more, implied volatility of 25-80%, a $1 billion company, $5 a share) and a ranking of how strongly a stock passes on value, premium, moat, health, red flags, option trading and stability. A stock that fails any filter stays under 70; 70-84 is Good, 85 and above is Prime. The Sunday Scan is the top 10 that pass, sorted by Wheel Score.
What is the GLS fair value for MSFT?
452.78 per share as of 5 Nov 2026 - the simple average of the 9 valuation models (out of nine: DCF, Graham Number, Graham Growth, Lynch, GLS Growth, 10 Cap, Payback Time, DDM and EPV) that produced a positive value. The models run every night on the latest filings; the Quote page lets you switch any of them off and add a margin of safety of your own.
When does Microsoft Corporation report earnings next?
The next earnings report is due on 27 Jan 2027, 83 days from the data date of 5 Nov 2026. The Calendars page lists every upcoming report with its time of day.
Does MSFT have listed options, and how liquid are they?
Yes. The nightly snapshot found 1,760 listed contracts with 2,185,748 open interest across all expiries and implied volatility of 29% on the near-the-money contracts. The Options scanner lists the cash-secured put and covered call set-ups with premium and annualised yield worked out.