馃攳
Microsoft Stock is The Most Undervalued FAAMG Stock | MSFT Stock Analysis - YouTube
Channel: unknown
[0]
so the first company we're going to take
[1]
a look at is microsoft now going into
[3]
earnings microsoft made some pretty big
[4]
headlines after it announced it was
[6]
acquiring activision for 68.7 billion
[9]
dollars microsoft will become the third
[11]
largest gaming company in revenue behind
[13]
tencent and sony with this deal
[14]
microsoft will gain control over some of
[16]
the biggest game series in the world
[18]
including call of duty warcraft
[19]
overwatch and a bunch of older games now
[21]
keep in mind that microsoft did purchase
[23]
bethesda softworks just over a year ago
[25]
and already purchased minecraft back in
[27]
2014. now the activision deal still has
[30]
to go through regulatory approval first
[31]
and recently there has been a lot more
[33]
harsh discussion about breaking up big
[35]
tech which microsoft had been escaping
[37]
but we're gonna have to see how this
[39]
plays out i do expect a fair amount of
[41]
scrutiny for this deal it seems like the
[43]
goal is to compete with facebook towards
[44]
the future of the metaverse and owning
[46]
more and more gaming platforms and
[48]
developers probably seems like a smart
[50]
way to gain an edge in the competition
[52]
satya nadala microsoft ceo says that he
[54]
doesn't expect a centralized metaverse
[56]
instead he thinks there's gonna end up
[58]
being multiple metaverses but if you ask
[60]
me to be honest i'm not really that sold
[62]
on the idea of the metaverse anyway i do
[64]
feel like we've seen a lot of physically
[66]
interactive content come and go from the
[68]
old wii which brought out the xbox
[70]
kinect and the playstation move and then
[71]
things like google glass but time and
[73]
time again people vote with their money
[75]
and it just doesn't seem like consumers
[77]
really want that fully immersive
[78]
experience that they're trying to sell
[80]
you with the metaverse maybe something's
[82]
gonna come along and change my mind but
[83]
for now i'm just not really that sold on
[85]
the idea of the metaverse succeeding
[87]
five to ten years from now now
[88]
microsoft's earnings came out on january
[90]
26th and the earnings came in at 2.48
[92]
cents versus 2.31 cents expected and
[95]
revenue came in at 51.7 billion versus
[98]
50.8 expected now i put together this
[100]
pretty cool chart showing a full year of
[102]
earnings for each quarter reported so
[104]
quarter 122 is actually showing you
[106]
quarter 121 through quarter 122 and
[109]
quarter 222 is showing you quarter 221
[112]
through quarter 222 so it's a full year
[114]
of earnings for each of those bars so
[116]
looking at this chart the red bar is the
[117]
most recently reported earnings report
[119]
so overall this was a very good quarter
[121]
for microsoft we can see since 2017
[123]
microsoft has shown some pretty
[125]
incredible earnings growth going from
[126]
3.37 per share in september 2017 to
[130]
9.39 earnings per share today so looking
[133]
at the current revenue and net income
[134]
chart we can see that highlighted again
[136]
not only is revenue quickly growing
[138]
since 2017 profits are also growing and
[140]
on top of that profit margins have
[142]
actually gone from 20 to 38 between 2015
[146]
and the past year when we look at
[147]
revenue versus expenses we can see why
[148]
microsoft is such a profitable company
[150]
first their cost of revenue is pretty
[152]
low counting for only about a third of
[154]
their revenue on top of that they also
[156]
bring in so much revenue that even after
[157]
spending 22 billion dollars on research
[160]
and development over the past year it's
[161]
hardly anything in comparison to their
[163]
158 billion in revenue that they brought
[165]
in on top of that they still spend 20
[167]
billion on sales and marketing and
[169]
another 5 billion on general and
[170]
administrative costs so again another 25
[173]
billion really just doesn't add up to
[174]
the 158 billion in revenue that they
[176]
made now looking at their segments
[178]
broken down we can see that they all are
[179]
performing very well the largest seems
[181]
to be the intelligent cloud business
[183]
which is their server related products
[184]
and obviously cloud services
[186]
productivity in business seems to be the
[188]
second largest segment which is made up
[189]
of microsoft office teams linkedin and
[192]
their other programs and apps the third
[194]
segment which still brought in 21
[195]
billion in operational income is the
[198]
more personal computing segment and this
[199]
segment's made up of the entire windows
[201]
operating system licenses the entire
[203]
xbox ecosystem and devices including the
[205]
surface and pc accessories now if we
[208]
look at the current forecast for
[209]
microsoft right now the current
[210]
projections are for microsoft to hit 256
[213]
billion in revenue and 93 billion in
[215]
profits by 2024. when we look at their
[217]
projected revenue growth going forward
[219]
we can see that microsoft is projected
[220]
to continue growing around 13 to 18
[223]
using that as our growth rate to value
[224]
them a growth rate of 13 comes out to a
[227]
fair p e value of 29 and a growth rate
[229]
of 18 comes out to a fair p e value of
[231]
44. now when we look over at macro
[233]
trends we can see that the p e ratios
[235]
for microsoft have been climbing
[237]
recently and this of course makes sense
[238]
when we look at their earnings per share
[239]
from 2006 until today they basically
[242]
showed no growth during that time span
[244]
so a p e ratio of 7 to 10 was
[246]
appropriate at the time for them however
[248]
we can also see that over the past
[249]
couple of years that p e ratio has been
[251]
climbing and it now sits in the low 30s
[253]
which is close to what i think the stock
[255]
should be worth now if we go over to
[256]
microsoft's value chart we can see that
[258]
microsoft is currently trading towards
[260]
the low end of its fair value and by
[261]
2024 it has an upside of 362 dollars or
[265]
20 higher and a high end upside of 549
[268]
or 81 percent higher than the current
[270]
share price so microsoft is definitely
[272]
cheap if you're looking to buy right now
[274]
and that clip was a part of a much
[275]
larger video that i did covering about
[277]
six stocks so if you want to check out
[279]
the full thing make sure you check it
[280]
out right over here and as always thanks
[283]
for watching
Most Recent Videos:
You can go back to the homepage right here: Homepage