Using the industry peer median P/E multiple (trailing + forward), Microsoft Corporation (MSFT) has a fair value of $442.36 based on 5 comparable companies in the Software - Infrastructure industry.
USD in millions except Fair Price. Subject company highlighted.
| Mkt Cap ($M) | Trailing P/E | Forward P/E | |
|---|---|---|---|
| Microsoft CorporationMSFT | 2,769,814 | 27.2x | 22.5x |
| NVIDIA CorporationNVDA | 4,342,817 | 36.5x | 21.6x |
| Apple Inc.AAPL | 3,648,319 | 33.3x | 29.3x |
| Alphabet Inc.GOOGL | 3,644,584 | 27.9x | 26.3x |
| Oracle CorporationORCL | 412,856 | 33.1x | 19.2x |
| Fortinet, Inc.FTNT | 59,767 | 33.1x | 27.0x |
| Industry Median | 33.1x | 26.3x | |
| (*) Profit after tax | 101,832 | 123,028 | |
| Equity Value | 3,368,199 | 3,236,197 | |
| (/) Outstanding shares | 7,465 | 7,465 | |
| Fair Price | $451 | $434 | |
This P/E relative valuation uses the industry peer median Price-to-Earnings ratio to estimate fair value. Both trailing (last 12 months) and forward (next fiscal year analyst estimates) P/E multiples are computed independently.
The industry median trailing P/E is applied to the company's TTM net income, and the forward P/E to analyst-estimated net income. Each produces an equity value divided by shares outstanding to yield a fair price per share. The selected fair value is the average of the trailing and forward legs.