Microsoft Corporation Stock Fair Value Calculation – Microsoft Warns of Near-Term Price Deterioration Due to GenAI Growth Roadblocks

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Microsoft Corporation ($NASDAQ:MSFT) is a multinational technology company headquartered in Redmond, Washington. Microsoft develops, manufactures, licenses, supports, and sells a wide range of computer software, consumer electronics, and related services. Recently, Microsoft has warned that if roadblocks in the growth of Artificial Intelligence (GenAI) are not addressed, it could lead to a decrease in price in the short-term. The company pointed to the lack of talent in the field of artificial intelligence and the difficulty in getting new technology off the ground as some of the major roadblocks. Microsoft believes that addressing these issues could help to unlock the potential of GenAI and help the company to achieve its long-term goals. Microsoft’s warning of near-term price deterioration due to GenAI growth roadblocks serves as a reminder that technological progress always has its challenges.

However, with the right strategies in place, Microsoft and other tech companies are confident that they can overcome these roadblocks together and continue to make advancements in artificial intelligence.

Price History

On Tuesday, MICROSOFT CORPORATION‘s stock opened at $373.9 and closed at $370.9, down by 1.4% from its last closing price of $376.0. GenAI, an abbreviation for General Artificial Intelligence, is the development of computer systems that are capable of learning and making decisions autonomously. Microsoft has been investing heavily in GenAI technology, however, roadblocks have hindered the progress of its GenAI growth. These roadblocks include challenges such as finding enough data to train the AI models, the reliance on cloud-based solutions, and the slow adoption of the technology in the industry. As a result, Microsoft warned that its near-term stock price is likely to deteriorate.

Investors have responded to this warning by driving down the company’s stock price. The stock has fallen by 1.4% since Tuesday, indicating that investors are concerned about the potential for negative impacts on Microsoft’s future growth. This has caused investors to take a cautious approach to investing in the company’s stock, which is likely to continue in the near future until Microsoft can make substantial progress in overcoming its GenAI growth roadblocks. Live Quote…

About the Company

Income Snapshot

Below shows the total revenue, net income and net margin for Microsoft Corporation. More…

Cash Flow Snapshot

Below shows the cash from operations, investing and financing for Microsoft Corporation. More…

Balance Sheet Snapshot

Below shows the total assets, liabilities and book value per share for Microsoft Corporation. More…

Key Ratios Snapshot

Some of the financial key ratios for Microsoft Corporation are shown below. More…

Analysis – Microsoft Corporation Stock Fair Value Calculation

GoodWhale has conducted an extensive analysis of MICROSOFT CORPORATION‘s wellbeing, which has revealed that the intrinsic value of its shares is around $322.8. This figure has been calculated using our proprietary Valuation Line, an analysis tool which takes into account multiple factors to determine the fair value of a share. At present, MICROSOFT CORPORATION shares are trading at $370.9, which indicates that the stock is currently overvalued by 14.9%. This means that investors could be paying more than the share is actually worth, and may be taking on more risk in the process. As such, we would advise potential investors to approach MICROSOFT CORPORATION with caution, and ensure that they have performed their own research before deciding whether or not to invest. More…

Peers

In the business world, there is always competition. For Microsoft Corp, its main competitors are Salesforce Inc, Apple Inc, and DocuSign Inc. While each company has its own strengths and weaknesses, Microsoft Corp must always be aware of what its competitors are doing in order to stay ahead.

– Salesforce Inc ($NYSE:CRM)

Salesforce Inc is an American cloud-based software company specializing in customer relationship management (CRM). As of March 2021, it had a market capitalization of US$153.53 billion, making it one of the most valuable companies in the world. Its Return on Equity (ROE) was 0.08%.

Salesforce was founded in 1999 by Marc Benioff and Parker Harris, and has since grown to become one of the largest CRM companies in the world. The company’s flagship product is its customer relationship management software, which helps businesses manage their customer data, sales, and marketing. Salesforce also offers a number of other software products and services, including a cloud-based development platform, a social networking service, and a customer service platform.

– Apple Inc ($NASDAQ:AAPL)

Apple is one of the world’s leading technology companies, with a market cap of 2.31T as of 2022. It designs, manufactures, and markets a range of mobile communication and media devices, as well as personal computers, portable digital music players, and sells a variety of related software, services, accessories, networking solutions, and third-party digital content and applications. The company has a strong focus on innovation and has been rewarded with a return on equity of 162.51% over the last year. This demonstrates the success of its business model and the confidence that investors have in its future prospects.

– DocuSign Inc ($NASDAQ:DOCU)

DocuSign Inc. is an American company that provides electronic signature technology and digital transaction management services for facilitating electronic exchanges of contracts and other documents. The company has a market capitalization of $9.74 billion as of 2022 and a return on equity of -15.28%. Founded in 2003, DocuSign has over 700,000 customers and more than 85 million users in 188 countries. The company’s headquarters are located in San Francisco, California. DocuSign’s primary product is its electronic signature platform, which enables users to sign, send, and manage documents electronically. The platform is used by businesses of all sizes, including over 90% of the Fortune 500. In addition to its signature platform, DocuSign offers a suite of products for digital transaction management, including contract management, workflow automation, and compliance tools.

Summary

Microsoft Corporation is an attractive investment for those looking to gain exposure to technology-driven growth. However, recent roadblocks in the development of GenAI could lead to near-term price deterioration for the company’s stock. Investors should conduct thorough research into the company’s financials, competitive landscape, and overall market conditions before making a decision about investing. The potential rewards from a Microsoft Corporation investment could be significant, but the risks should not be overlooked.