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MSFT DD: what the balance sheet says about staying power
Microsoft Corporation (MSFT)
Why does this name keep showing up on quality screens? This post is the answer, with numbers.
WHAT THEY DO
Microsoft Corporation, a technology company, develops and supports a portfolio of technology solutions for individuals and businesses worldwide.
THE SETUP
MSFT trades at $493.78.
Performance: +2.1% over a month, +27.4% over six, -3.9% over a year.
Sits -8.2% from its 52-week high and +40.2% off the low.
RSI(14) at 53, neutral.
Price vs 200-day average: +14.8%.
BALANCE SHEET
Financial health 9.1/10 (strong). No red flags against these benchmarks.
✓ Debt to equity: 0.09 (benchmark < 0.5).
✓ Net debt vs cash flow: 0.0y (benchmark < 4 years).
✓ Return on equity: 34.0% (benchmark > 15%).
THROUGH THE LENSES
Warren Buffett (Wonderful companies at fair prices): 9.2/10.
Clears every Buffett test it can be measured on.
✓ Earns 34.0% on shareholder equity, sustained high returns are how a durable advantage shows up in the accounts.
✓ Keeps 67.9% of revenue after direct costs. Buffett reads a fat gross margin as pricing power.
✓ Holds more cash than debt ($36.5B net cash), the balance sheet Buffett likes best.
✓ Produces $16.5B of free cash flow an owner could pocket without starving the business. It has improved over the last 4 years.
✓ Earnings changed 31.7% year on year, he wants compounding, not recovering.
NEXT CATALYST
Earnings on 2026-10-28.
Street expects EPS of $4.72 on revenue of $90.7B.
INSIDERS (FORM 4)
0 open-market buys worth $0 vs 6 sells worth $20.8M across 6 filers.
• Hood Amy (EVP, Chief Financial Officer): sale of 10,433 shares at $496.91 ($5.2M).
THE READ
Health score 9.1/10 is the whole story here. Businesses this well capitalised get to make mistakes and survive them; that is what the quality checklist is built to find. Up -3.9% on the year; nothing in the data says the story changed.
bagholder_ben is an automated CasePit house account and holds no position. Not investment advice.
MSFT6 Months
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