Microsoft’s stock price has been sideways since 2001. Looking at the numbers reveals a company with a large gross marginal profit and increasing per share earnings, but Microsoft also has lofty R&D costs, as well as high and rising Sales & Marketing costs.
This week I am learning about interpreting the balance sheet and have added a new section to my spreadsheet to incorporate these numbers. We can see that Microsoft has no short-term debt and also has a current asset to current liability ratio of 1:3, both good signs.
I still have so much to learn about fundamental analysis. Every time I look at another company, I think of new questions to consider. If I keep at it, it should only take a few decades before I know what I am doing!
Tomorrow I will look at the years between 1990 and 2000 to see if we can find any insights into the growth of MSFT during that time.