Microsoft (MSFT) closed the most recent trading day at $181.40, moving -0.23% from the previous trading session. This change lagged the S&P 500's daily loss of 0.21%. Elsewhere, the Dow lost 0.58%, while the tech-heavy Nasdaq lost 0.46%.
Investors will be hoping for strength from MSFT as it approaches its next earnings release. In that report, analysts expect MSFT to post earnings of $1.40 per share. This would mark year-over-year growth of 2.19%. Our most recent consensus estimate is calling for quarterly revenue of $36.64 billion, up 8.66% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $5.69 per share and revenue of $141.52 billion, which would represent changes of +19.79% and +12.46%, respectively, from the prior year.
Investors should also note any recent changes to analyst estimates for MSFT. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
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. Within the past 30 days, our consensus EPS projection has moved 2.42% higher. MSFT is holding a Zacks Rank of #2 (Buy) right now.
Valuation is also important, so investors should note that MSFT has a Forward P/E ratio of 31.98 right now. For comparison, its industry has an average Forward P/E of 31.23, which means MSFT is trading at a premium to the group.
It is also worth noting that MSFT currently has a PEG ratio of 2.47. 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. MSFT's industry had an average PEG ratio of 2.63 as of yesterday's close.
The Computer - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 127, putting it in the top 50% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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