Microsoft (MSFT) closed the most recent trading day at $503.51, moving +1.39% from the previous trading session. This move outpaced the S&P 500's daily gain of 0.61%. Elsewhere, the Dow saw an upswing of 0.49%, while the tech-heavy Nasdaq appreciated by 0.95%.
Prior to today's trading, shares of the software maker had gained 5.46% lagged the Computer and Technology sector's gain of 5.6% and outpaced the S&P 500's gain of 3.85%.
Market participants will be closely following the financial results of Microsoft in its upcoming release. The company is expected to report EPS of $3.35, up 13.56% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $73.71 billion, up 13.88% from the year-ago period.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $13.36 per share and a revenue of $279.09 billion, representing changes of +13.22% and 0%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for Microsoft. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the business health and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.08% higher within the past month. Microsoft presently features a Zacks Rank of #2 (Buy).
With respect to valuation, Microsoft is currently being traded at a Forward P/E ratio of 33.19. This indicates a premium in contrast to its industry's Forward P/E of 26.8.
Meanwhile, MSFT's PEG ratio is currently 2.25. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. MSFT's industry had an average PEG ratio of 2.4 as of yesterday's close.
The Computer - Software industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 36, placing it within the top 15% of over 250 industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Ensure to harness Zacks.com to stay updated with all these stock-shifting metrics, among others, in the next trading sessions.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Microsoft Corporation (MSFT): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
Zacks Investment Research
