Microsoft hits year-high 18th time in three months 11 June 2019

NEWS BITES - NORTH AMERICA

Microsoft Corporation (NASDAQ:MSFT), the NASDAQ's largest Computer software company by market cap, hit a 52-week high of $US134.24 during the day, but closed lower at $US132.10. In the last one month Microsoft's stock has hit a new 52-week high three times and in the last three months eighteen times. Microsoft's stock price has decreased 50.0c (0.4%) from its previous trading session to close at $US132.10. Compared with the NASDAQ-100 Index which rose 11.9 points (0.2%) in the day, the relative price change was -0.5%. The volume was 0.7 times the average daily trading volume of 29.5 million shares. There were 21,344,439 shares worth $US2.8 billion traded today.

TODAY'S BUZZ

Traders bet on a big short-term move in Microsoft as tech giant hits all-time high: CNBC

Stock Summary

Day's Range$US131.28-$US134.24
52-Week Range$US93.22-$US134.24
SectorComputer Software sector
Market Cap$US1,013 billion
Shares Outstanding7,668,217,000

Highlights in today's Report:

SECTION 1 TODAY'S AGGREGATE VOLUMES AND PRICES

SECTION 2 TODAY'S BULLISH SIGNALS

SECTION 3 TODAY'S BEARISH SIGNALS

SECTION 4 RELATED NEWS

RECAP FROM PREVIOUS REPORTS (UPDATED AT THE LAST PRICE OF $US132.10):

SECTION 5 THE PAST WEEK

SECTION 6 ONGOING BULLISH PARAMETERS

SECTION 7 ONGOING BEARISH PARAMETERS

SECTION 8 REPORTED BUYING AND SELLING

SECTION 9 SUMMARY FINANCIALS

SECTION 10 CORPORATE PROFILE

SECTION 1 TODAY'S AGGREGATE VOLUMES AND PRICES

[Volume Index or VI in brackets; 1 is average]

+ Nasdaq: MSFT.NASDAQ 21,344,439 [VI of 0.7] volume 99.91% of aggregate. Price: $US132.10.

+ Xetra: MSF.ETR 19,837 [VI of 1.7] volume 0.09% of aggregate. Price: EUR116.12. Using the current exchange rate of EUR1 equals 1.1317USD, The shares are at a 0.5% discount to the close price on Nasdaq.

+ Aggregate volume: there were 21.4 million shares of Microsoft worth $US2.8 billion traded today. The aggregate volume was 0.7 times average trading of 29.5 million shares.

SECTION 2 MICROSOFT BULLISH SIGNALS

2.1 Undervaluation [compared with sector average]:

Price/Earnings and Earnings Yield

+ Price/Earnings of 29.1 [33.6].

+ Earnings yield of 3.4% is 1.6 times the 10-year bond yield of 2.15%.

Dividend Yield

+ The relative yield of MSFT, defined by its yield of 1%, divided by average yield of dividend yielding stocks in the NASDAQ-100 Index of 1.0% is 102.0%. This suggests Microsoft stock is undervalued in dividend yield terms.

Brand Value/Enterprise Value

+ Brandirectory have estimated Microsoft's brand value at $US45.5 billion. The Brand Value represents 4.7% of the estimated Enterprise Value of $US973 billion. Enterprise Value is defined as MCap of $US1,013 billion plus net debt of $US-40 billion.

2.2 Undervaluation Indicator and rank of Microsoft in the Usnasdaq market:

DescriptionValueRank In Market
* EV/EBITDA26.7In Top 5%

* Enterprise value of $US973 billion is divided by Earnings before interest tax depreciation and amortization of $US36.5 billion.

2.3 Uptrend:

Price/Moving Average Price and MACD:

+ The Price/MAP of 1.18 for MSFT is higher than the Price/MAP for the NASDAQ-100 Index of 1.07.

+ The Moving Average Convergence Divergence (MACD) indicator of 12-day Exponential Moving Average (EMA) of 127.93 minus the 26-day EMA of 126.48 is positive suggesting a bullish signal. Both the 12-day EMA as well as the 26-day EMA are rising, another bullish signal.

+ The price to 50-day EMAP ratio is 1.1, a bullish indicator. In the past 50 days this ratio has exceeded 1.1, seven times suggesting further upside. The 50-day EMAP has increased to $US124.01. An increase is another bullish indicator.

+ The price to 200-day MAP ratio is 1.18, a bullish indicator. In the past 200 days this ratio has exceeded 1.18 five times suggesting further upside. The stock is trading above both its MAPs and the 50-day MAP of $US124.74 is higher than the 200-day MAP of $US112.16, a bullish indicator. The 200-day MAP has increased to $US112.16. An increase is another bullish indicator.

Past Week:

+ Microsoft Corporation is placed 209/2484 in BuySellSignals' ranking of NASDAQ performers in the past week, a percentile ranking of 92.

+ In the past week, volume was 0.9 times average and the shares were up 7.3%. Tuesday's close price is at a 1.5% premium to its 5-day Volume Weighted Average Price (VWAP) of $US130.10.

Past Month:

+ In the past three months the stock has hit a new 52-week high eighteen times, pointing to a significant uptrend.

+ The present value of $US1,000 (PV1000) invested one month ago in Microsoft is $US1,079, comprising a capital gain of $US75 and dividend reinvested of $US4.

PV$10001-week1-month1-year
MSFT.NASDAQ1,0731,0791,339
NASDAQ-100 Index1,0481,0191,048

Relative Strength (6 months):

+ In the NASDAQ market of 2,447 stocks and 10 units traded today, the stock has a 6-month relative strength of 79 indicating it has outperformed 79% of the market.

2.4 High Price Performance Indicators and rank of Microsoft in the NASDAQ market:

DescriptionMSFT ValueRank In Market
MCap$US1,013 billionIn Top 1%
Today's Trading Turnover$US2.8 billionIn Top 1%
Price/MAP501.06In Top Quartile
Price/MAP2001.18In Top Quartile
% Prem to Vol Wtd Price4.5In Top Quartile

SECTION 3 MICROSOFT BEARISH SIGNALS

3.1 Overvaluation [compared with sector average]:

MCap/Total Assets

+ Tobin's Q Ratio, defined as MCap divided by Total Assets, is 3.9. Compared with the rest of the market the stock is overvalued and ranks in the bottom quartile of stocks by value of Q Ratio.

3.2 Overvaluation Indicators and rank of Microsoft in the Usnasdaq market:

DescriptionValueRank In Market
Price to Sales8.3In Bottom 9%
Dividend Yield %1.0In Bottom Quartile

3.3 Downtrend:

+ Increasing Put Call Ratio

+ Put Call Contracts

The Put/Call ratio has jumped from 1.042 to 1.056 suggesting a downtrend.

Put ContractsCall ContractsPut/Call ratio
Today157,022148,6511.056
Previous day143,939138,1671.042

+ Put Call Ratio increases 1.3%

Put Call Ratio1 Day1 Week1 MonthInterpretation
Change %1.342.310.3Downtrend

Overbought/Bearish Signals:

+ The stock is overbought according to the Williams % R indicator of -14.1, suggesting the price is close to its 14-day high of $US134.24.

SECTION 4 MICROSOFT RELATED NEWS

Corporate Bonds

+ Microsoft Corp 21-year bond YTM increases by 6.7 basis points

Microsoft Corp (MSFT.GH) bond price has decreased $US1.11 (or 1.0%) from its last trading session of June 07, 2019 to close at $US115.53. The bond matures in 21 years and 4 months; its yield to maturity (YTM) has increased by 6.7 basis points from 3.4% to 3.46%.

RECAP FROM PREVIOUS REPORTS (UPDATED AT THE LAST PRICE OF $US132.10):

SECTION 5 THE PAST WEEK

5.1 Snapshot: Microsoft stock was up $US8.94 or 7.3% in the past week. Volume in the week was 0.9 times average trading of 147.5 million shares. It outperformed the NASDAQ-100 index in 4 out of 5 days.

DayMicrosoftClose price [USD]Price change %Relative change %Comment
MondayHits year-high 17th time in three months132.60.9-0.2
FridayIn top 5% performers of NASDAQ-100 Index131.42.80.9Top Rise; VI*=1.1
ThursdayKeeps rising, up 5.2% in 3 days127.821.60.8
WednesdayIncreases 1.3% strengthening above moving average price125.832.21.4
TuesdayAdds $US10 billion in MCap, top heavyweight rise in Computer software sector123.162.80.1

[Volume Index (VI); 1 is average]

5.2 Corporate Wires: Microsoft (MSFT) issued five Releases in the past week.

June 06: Catapult Systems recognized as Winner for 2019 Microsoft PowerApps Partner of the Year

AUSTIN, Texas, June 6, 2019 -- Catapult Systems today announced it has won the 2019 Microsoft PowerApps Partner of the Year Award. The company was honored among a global field of top Microsoft partners for demonstrating excellence in innovation and implementation of customer solutions based on Microsoft technology.

"We are honored that Microsoft has again recognized Catapult as a worldwide Partner of the Year award winner, this time for our work in PowerApps.

June 06: Microsoft announces 2019 Partner of the Year Award winners and finalists

Partners recognized for innovative solutions and making more possible for customers worldwide

REDMOND, Wash., June 6, 2019 -- Microsoft Corp. on Thursday announced the winners and finalists of the Microsoft 2019 Partner of the Year Awards. The annual awards recognize Microsoft partners demonstrating excellence in innovation and implementation of customer solutions based on Microsoft technology.

June 05: Microsoft and Integreon Mark 10 Years of Innovation, Remarkable Results, and Advancement in Legal Services Delivery

WASHINGTON---- Today, Integreon, a leader in alternative legal and business services for law firms and corporations, celebrates a highly productive and transformative 10-year partnership with Microsoft Corporation (NASDAQ: MSFT). Over the past decade, Integreon has exponentially grown its Microsoft operation from a single US-based specialist team in 2009 to now providing managed legal services across five delivery centers, three continents, and in 14 languages worldwide.

Microsoft is a pioneer in recognizing the vast potential of innovative alternative legal service providers (ALSPs) like Integreon.

June 05: Nasdaq Joins Microsoft to Increase Access to Real-Time U.S. Equity Market Data

NEW YORK, June 05, 2019 -- Nasdaq (Nasdaq:NDAQ) is collaborating with Microsoft (Nasdaq:MSFT) to expand the use of real-time U.S. equity market data by individual investors. Through Excel, Bing, MSN, and other platforms and services owned by Microsoft, the general public, including individual investors and students, can now leverage real-time U.S.

June 05: Microsoft and Oracle to interconnect Microsoft Azure and Oracle Cloud

REDMOND, Wash. and REDWOOD SHORES, Calif., June 5, 2019 -- Microsoft Corp. and Oracle Corp. on Wednesday announced a cloud interoperability partnership enabling customers to migrate and run mission-critical enterprise workloads across Microsoft Azure and Oracle Cloud. Enterprises can now seamlessly connect Azure services, like Analytics and AI, to Oracle Cloud services, like Autonomous Database.

5.3 Stock Buzz: Past Week

News DateHeadlinePublisher
Jun 10Project Scarlett: What We Know About Microsoft s New Xbox Console 2020InvestorPlace
Jun 10Monday s Vital Data: Microsoft, Square and AT&TNasdaq
Jun 10Short-Term Options Pop as AAPL, MSFT Stocks Climb DowSchaeffers Research
Jun 10Microsoft's Large Share Buyback Program Will Move The Stock HigherSeeking Alpha
Jun 10StockBeat - AMD to Power Microsoft's Next-Gen Console; Shares Hit 13-Year HighYahoo Finance
Jun 10Microsoft's Project Scarlett, EA Updates To 'Apex Legends' Highlight Opening Of E3benzinga.com
Jun 10Microsoft Co. (NASDAQ:MSFT) Shares Bought by Bernicke Wealth Management Ltd.theenterpriseleader.com
Jun 07Microsoft (NASDAQ: MSFT) Looking for buyers to remain in controlFXStreet
Jun 07Microsoft And Oracle Team Up To Challenge AmazonInternational Business Times
Jun 07Noteworthy Friday Option Activity: AZO, MSFT, WYNNMarket News Video
Jun 06Legal IT Newswire: Microsoft and Integreon Mark 10 Years of Innovation, Remarkable Results, and Advancement in Legal Services DeliveryLegal Technology
Jun 06Microsoft announces 2019 Partner of the Year Award winners and finalistsMicrosoft
Jun 06Microsoft anuncia los ganadores y finalistas de los Premios Partner of the Year 2019PR Newswire
Jun 06Triad Investment Management Purchases Shares of 2,000 Microsoft Co. (MSFT)dispatchtribunal.com
Jun 05Microsoft and Integreon Mark 10 Years of Innovation, Remarkable Results, and Advancement in Legal Services DeliveryBusiness Wire
Jun 05Nasdaq Joins Microsoft to Increase Access to Real-Time U.S. Equity Market DataMarkets Insider
Jun 05Microsoft and Eneco team up to drive sustainable business transformations: powering the cloud with clean energyOil And Gas 360

5.4 PEOPLE'S NEWS:

June 08 Microsoft Director Sandra E. Peterson's value of investment increases by $522,151 in the past quarter

Microsoft (NASDAQ:MSFT) Director Sandra E. Peterson held 20,067 shares three months ago and the price was US$109.98. Sandra E. Peterson now holds 20,770 shares worth US$2.7 million at the last price of US$131.40, a rise in value by US$522,151 (23.7%).

June 09 Microsoft Director Penny Pritzker's value of investment increases by $428,948 in the past quarter

Microsoft (NASDAQ:MSFT) Director Penny Pritzker held 15,979 shares three months ago and the price was US$109.98. Penny Pritzker now holds 16,639 shares worth US$2.2 million at the last price of US$131.40, a rise in value by US$428,948 (24.4%).

June 08 Microsoft Chief Marketing Officer Chris Capossela's value of investment decreases by $18.3 million in the past quarter

Microsoft (NASDAQ:MSFT) Chief Marketing Officer Chris Capossela holds 141,934 shares worth US$18.7 million at the last price of US$131.40, a fall in value by US$18.3 million (49.6%). Three months ago Chris Capossela held the same number of shares and the price was US$109.98.

5.5 Volatility:

+ Microsoft is at a discount of 1.6% to its 12-month high of $US134.24 on June 11. It is also at a premium of 41.7% to the 12-month low of $US93.22 on December 26, 2018.

SECTION 6 ONGOING BULLISH PARAMETERS

6.1 Performance:

+ Return on Capital Employed 18.2% [16.3%].

+ Net profit margin has averaged 20.4% in the last 3 years. This is considered superior and suggests a high margin of safety.

6.2 Growth:

Quarterly Trend in Revenue, Net Profit and Net Profit Margin:

+ Net Profit margin is positive and has seen consecutive rises in recent quarters. [All figures in %]

Qtr-endedRevenue GrowthNet Profit GrowthNet Profit Margin
Mar 19 [Q3]-5.94.628.8
Dec 18 [Q2]11.6-4.625.9

Annual Trend in Revenue, EPS and EBITDA:

+ Revenue growth rate is positive and has seen consecutive rises in recent years. [Year ended, all figures in %]

YearRevenue GrowthEPS GrowthEBITDA Growth
Jun 1814.3-34.722
Jun 1713.255.251.4
Jun 1612.343.2-19.3

6.3 Low Debt Indicators:

+ Total Liabilities/EBITDA of 4.8 is less than the Joseph Piotroski benchmark of 5.

6.4 High Performance Indicators and rank of Microsoft in the Usnasdaq market:

DescriptionValueRank In Market
Return on Equity [ROE] %20.0In Top Quartile
EBITDA Margin %33.1In Top Quartile

6.5 Moving Annual Return (Past 5 years)

Based on a dynamic start date of 5 years ago, the real rate of return has averaged 32.5%. The Moving Annual Return has consistently exceeded 16%.

MSFTClose (USD)Dividends (USD)Capital Gain %% YieldAnnual Return %
Jun 11132.11.3432.31.333.6
1 Yr ago99.861.6546.52.448.9
2 Yrs ago68.161.53403.143.2
3 Yrs ago48.691.3913.53.216.8
4 Yrs ago42.891.2116.63.319.8

Close 5 years ago $US36.80

6.6 Increased ADVT past five years

Avg. Daily Volume Traded 12 months ended Jun 11, million shares

YearADVT
201929.5
201825.1
201725.1
201635.7
201529.1

In the past five years, Average Daily Volume of Trading (ADVT) has increased 1.3% to 29.5 million shares.

6.7 Increased VWAP

Past five years, 12 months ended Jun 11 (USD)

YearHigh PriceVWAPLow Price
2019134.24109.1693.22
2018101.4983.5965.94
201770.6657.9145.79
201653.3246.6536.81
201545.2940.7636.12

In the past five years Volume Weighted Average Price (VWAP) has increased by 167.8% to $US109.16. Based on a dynamic start date of five years ago, there has been no decline in VWAP over the last 5 years.

6.8 Increased Average Daily Turnover

Past five years, 12 months ended Jun 11 (USD billion)

YearAverage Daily Turnover
20193.2
20182.1
20171.5
20161.7
20151.2

In the past five years, average daily share turnover has increased 169.0% to $US3.2 billion. This suggests increased liquidity.

6.9 Decrease in Insider Selling

In the past 5 years a total of 179,422,787 Microsoft shares worth $US9.7 billion were sold by insiders. Based on a dynamic start date of 5 years ago, insider selling has averaged 35,884,557 shares per year. In the past year, insiders sold 1,458,927 shares, a decrease of 79.7% from the previous year.

6.10 Turnover Rate & Turnover Period:

+ The turnover rate in the 12 months to date was 79.8% (or a turnover period of 1 year 3 months). The average length of ownership of the stock is 2.3 times the average holding period of 6 months for stocks in the NASDAQ-100 Index suggests a larger number of core investors, making a long-term investment safer.

SECTION 7 ONGOING BEARISH PARAMETERS

7.1 Performance:

+ Return on Equity 20.0% [30.3%].

+ Return on Assets 6.4% [11.8%].

7.2 High Debt Indicators:

+ The debt to equity ratio of 98.9% is above a safe benchmark figure of 70%. However, it has improved from 104.4% a year ago.

DescriptionValueRank In Market
Debt to Equity1.0In Bottom Quartile

SECTION 8 MICROSOFT REPORTED BUYING AND SELLING

8.1 Institutional Buying and Selling Quarter Ended March 31

Total reported Institutional buying = 144,504,057 shares

Total reported Institutional selling = 150,187,993 shares

Net reported institutional selling = 5,683,936 shares

8.2 Reported Holdings of Institutions as at Mar 31, 2019

Total = 4,943,580,509 shares

Market Value = $US580.9 billion

Institutions hold 64.5% of Issued Shares.

SECTION 9 MICROSOFT SUMMARY FINANCIALS

9.1 Dividend History

+ Trailing 12 months dividend for the 12 months ended June 11 has improved from $US1.21 in 2015 to $US1.34 in 2019; there were 1 decline in the past 5 years. Dividends were down 18.8% for the 12 months ended June 11 from $US1.65 in 2018 to $US1.34 in 2019.

9.2 Financials Summary

Year endedJun 2018Jun 2017Jun 2016
Sales (USD B)110.496.685.3
Pretax (USD B)36.529.919.8
Net (USD B)16.625.516.8
EPS (USD)2.153.292.12

+ Net profit was down 35% from US$25.5 billion in 2017 to US$16.6 billion in 2018.

+ Earnings Per Share (EPS) was down 34.7% from $US3.29 to $US2.15.

SECTION 10 CORPORATE PROFILE

10.1 Activities

Microsoft Corporation develops, manufactures, licenses and supports a range of software products for computing devices. The Company's software products include operating systems for servers, personal computers and intelligent devices, server applications for distributed computing environments, information worker productivity applications, business solution applications, high-performance computing applications and software development tools and video games. It provides consulting and product support services, and trains and certifies computer system integrators and developers. Microsoft Corporation sells the Xbox 360 video game console and games, the Zune digital music and entertainment device, PC games, and peripherals. The Company has five segments: Client, Server and Tools, the Online Services Business, the Microsoft Business Division, and the Entertainment and Devices Division.

10.2 Top Management

The chairman is John W. Thompson, the chief executive officer is Satya Nadella and the chief financial officer is Amy Hood.

10.3 Issued Capital and MCap

Based on 7,668,217,000 issued shares the market capitalisation is $US1,013 billion.

COMPANY IDENTIFIERS

Contact: +1 425 882-8080

Physical Address: One Microsoft Way, Redmond, WA,98052-6399

State/Province/Country: WA, United States

Country of Incorporation: United States

Industry [NAICS]: 511210

Exchange: NASDAQ

Business Sector: Software & IT Services

Industry Group: Software & IT Services

Industry: Software

Economic Sector: Technology

ISIN: US5949181045

O:MSFT; MSFT.O

PermID: 4295907168

RIC: MSFT.O

CIK: 789019

CUSIP: 594918104

Microsoft Corp

Source: www.BuySellSignals.com