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Microsoft Corporation

2026-05-01🇺🇸 S&Ptechnology
407.78 USD
52-Week Range
$356.28
$555.45

AI Consensus

Model estimate
$472.96
Incl. 30% analyst anchoring
Gap
+16.0%
Agreement
0.795/5 models
Raw 0.71
Dispersion
σ 0.09
Analyst consensus
$570.72(54 analysts)
AI Summary
5 of 5 AI models are positive on MSFT. Key driver: Sustained demand for cloud services (Azure) and enterprise software (Microsof... AI consensus estimate 472.96 16.0% above the current price. Model agreement is high (0.79). Analyst consensus: 570.72 (AI -17.1%).
gptclaudegeminideepseekgrokMSFTMicrosoft C…407.8spot570.7analysts388429469509550590
Bear Case (min)
$370.97
-9.0%
Base Case (median)
$472.96
+16.0%
Bull Case (max)
$546.70
34.1%

Estimate History AI model estimates and spot price over time

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What Changed Today

Consensus Est.:456.68472.96(+3.6%)
CAGR
+1.0pp(2 ↑)
MARG
-1.0pp(2 ↓)
no-assumption-changestable-modelai-revenue-acceleration
Model Breakdown
CLAUDE
Est.
553.91
Gap
+35.8%
Conf
0.77
DCF 546.70Cal. 553.91
Key Drivers
  • Historical revenue CAGR of 12.4% (2022–2025) is accelerating: analyst consens…
  • Azure Intelligent Cloud segment is the primary growth engine; AI workloads (i…
  • Copilot integration across Microsoft 365 (600M+ commercial seats), GitHub, Dy…
Top Risk
  • Elevated capex (~20% of revenue, rising toward ~$200B in 2026) for AI infrastructure ma…
  • Intensifying competition from AWS, Google Cloud, and emerging AI-native platforms could…
  • Loss of exclusive or preferred OpenAI access under the revised partnership structure co…
Delta
All four core valuation assumptions remain unchanged from the prior day model (2026-04-30). The updated market anchor…
No change
no-assumption-changestable-modelai-revenue-acceleration
GPT
Est.
527.61
Gap
+29.4%
Conf
0.70
DCF 509.13Cal. 527.61
Key Drivers
  • Strong demand for cloud and AI services
  • Recurring revenue from subscription products
  • Continued expansion in global markets
Top Risk
  • Intense competition in cloud services
  • Regulatory scrutiny over data privacy and monopolistic practices
  • Potential economic downturn affecting IT spending
Delta
Assumptions remain robust due to strong growth in AI services and ongoing demand for cloud products.
No previous data
technologygrowth
GROK
Est.
472.96
Gap
+16.0%
Conf
0.80
DCF 431.06Cal. 472.96
Key Drivers
  • Strong historical revenue growth (12.4% CAGR) supports a forward-looking CAGR…
  • Azure and Intelligent Cloud segment expected to maintain momentum with increa…
  • High trailing EBIT margin (40.4%) with slight upside to 42% due to operating …
Top Risk
  • Intensifying competition in cloud services from AWS and Google Cloud could pressure fut…
  • High capex (20.3% of revenue) may impact cash flows if growth expectations are not met.
  • Regulatory scrutiny and geopolitical tensions could hinder global expansion efforts.
Delta
Assumptions remain largely consistent with yesterday's model, with a slight increase in revenue CAGR due to updated n…
CAGR
+1.0pp
MARG
-1.0pp
stable assumptionsminor update
GEMINI
Est.
469.50
Gap
+15.1%
Conf
0.80
DCF 426.12Cal. 469.50
Key Drivers
  • Sustained demand for cloud services (Azure) and enterprise software (Microsof…
  • Significant investments and leadership in Artificial Intelligence (AI) integr…
  • Strong operating leverage from a highly scalable software and subscription-ba…
Top Risk
  • Intensifying competition in cloud computing and AI markets from major technology rivals…
  • High capital expenditures required for AI infrastructure and data centers, potentially …
  • Regulatory and antitrust scrutiny, particularly regarding AI partnerships and market do…
Delta
Adjusted 5-year revenue CAGR slightly upwards reflecting strong AI momentum, and a minor adjustment downwards in targ…
CAGR
+0.5pp
MARG
-1.0pp
GROWTH OUTLOOK UPDATEMARGIN UPDATE
DEEPSEEK
Est.
430.89
Gap
+5.7%
Conf
0.70
DCF 370.97Cal. 430.89
Key Drivers
  • Azure and cloud services continue to drive double-digit revenue growth, suppo…
  • Strong operating leverage from scale in Intelligent Cloud and Productivity se…
  • Historical revenue CAGR of 12.4% (2022-2025) provides a baseline for future g…
Top Risk
  • Regulatory and legal scrutiny of AI partnerships (e.g., Musk-OpenAI lawsuit) could disr…
  • Elevated capex at 20.3% of revenue pressures free cash flow and margin in near term
  • Macroeconomic slowdown or tech spending cuts could reduce enterprise demand
Delta
No material change in assumptions from yesterday's model. The key drivers and risks remain consistent with the prior …
No change
no changestable outlook

Valuation Assumptions

CLAUDEDEEPSEEKGEMINIGPTGROK
Revenue CAGR 5Y15.0%12.0%16.0%
+0.5pp
14.0%15.0%
+1.0pp
EBIT Margin Target44.0%45.0%42.0%
-1.0pp
45.0%42.0%
-1.0pp
WACC9.4%10.5%11.0%9.5%10.5%
Terminal Growth3.0%2.0%2.0%2.0%2.0%

What Would Need to Be True?

AssumptionAI ConsensusMarket Price Implies
Revenue CAGR (5y)15.0%13.7%-1.3pp
EBIT Margin Target44.0%39.5%-4.5pp
WACC10.5%11.1%+0.6pp
Based on spot price $407.78 and raw DCF model (before caps and calibration).

Fundamentals

EBIT Margin40.4%
EBITDA Margin58.0%
ROE36.5%
Net Debt / EBITDA0.3x
P/E Trailing24.2x
EV / EBITDA16.7x
P/B7.8x
Analyst Range
Microsoft Corporation develops and supports software, services, devices, and solutions worldwide. The Productivity and Business Processes segment offers Microsoft 365 commercial, enterprise mobility + security, windows commercial, power BI, exchange, sharepoint, Microsoft teams, security and compliance, and copilot; Microsoft 365 commercial products, such as Windows commercial on-premises and office licensed services; Microsoft 365 consumer products and cloud services, including Microsoft 365 consumer subscriptions, office licensed on-premises, and other consumer services; LinkedIn; dynamics products and cloud services, such as dynamics 365, cloud-based applications, and on-premises ERP and CRM applications. Its Intelligent Cloud segment provides Server products and cloud services comprising Azure and other cloud services, GitHub, Nuance Healthcare, virtual desktop offerings, and other cloud services; server products, including SQL and windows server, visual studio and system center related client access licenses, and other on-premises offerings; enterprise and partner services, such as enterprise support and nuance professional services, industry solutions, Microsoft partner netwo
Source: Yahoo Finance

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