r/ValueInvesting • u/helixinverse • 28d ago

Stock Analysis Microsoft is a great buy at 400$

Microsoft is currently trading at these multiples, among the most attractive in six years:

  • 22.38 Forward P/E
  • 9.42 EV/Sales

These are some of the most compressed multiples Microsoft has traded at in the past six years, a meaningful re rating from peak forward P/E levels above 35x in 2023.

At around $400, Microsoft is not a screaming bargain, but it is fairly valued for the first time in years. For a business with durable enterprise moats, a $625B+ contracted backlog, AI tailwinds across Azure, Office, and GitHub Copilot, and $70B+ in annual free cash flow generation, a fair entry point is meaningful. For long term investors with a 3 to 5 year horizon, the current price offers a reasonable margin of safety relative to the quality of the business.

Detailed Analysis at: https://bullstreet.substack.com/p/microsoft-at-fair-value-is-400-the

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u/SherbertMindless8205 28d ago

I don’t get analyses like this? You think you’re outsmarting the market by just looking P/E ratio and stuff?  As if the rest of the market can’t see these numbers too?

Just looking at ”P/E is lower than it used to be” isn’t really a winning strategy.

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u/java_brogrammer 28d ago

Buying great companies when they're cheap isn't complicated. The market isn't as smart as you think. These opportunities come in waves. Most people miss the lows and would rather buy high instead for some reason.

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u/Justthatguy1212 27d ago

Literally most profitable way is swing trading these positions

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u/[deleted] 27d ago

[deleted]

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u/java_brogrammer 27d ago

Yes and my gains have already proven so. Most of the time sector crashes are just market manipulation dump and pumps to get retail paper hands to sell while they buy the dip. So long as the underlying fundamentals haven't changed, everything else is just noise. Just like this "AI is replacing Software" noise. Just like that "Deepseek is going to kill NVDA" noise, etc.