MSFT - Embedded Expectations Analysis - 2020 06 17
Microsoft Corporation (MSFT:USA) currently trades at a historical high relative to UAFRS-based (Uniform) earnings, with a 27.5x Uniform P/E. At these levels, the market has bullish expectations for the firm, but management may have concerns about growth, Microsoft Teams, and their portfolio of servicesSpecifically, management may lack confidence in their ability to sustain growth in gross margin, Productivity and Business Processes segment revenue, and on-premises server business revenue. In addition, they may have concerns about the security of Microsoft Teams for remote work, the sustainability of Teams meetings usage in the health care industry, and lower OEM revenue growth expectations. Moreover, they may lack confidence in their ability to increase customer utility from using Microsoft Teams, help businesses migrate to the cloud, and improve developer relevance.
Furthermore, they may be exaggerating the comprehensive capabilities of Microsoft Teams, the effectiveness of their Talent Solutions portfolio in retaining and developing talent, and the value of their speech services
Microsoft is a technology company. The company develops and supports software, services, devices, and solutions. The company provides an array of services, including cloud-based solutions as well as solution support and consulting services. The company also delivers relevant online advertising. The company's products include operating systems; cross-device productivity applications; server applications; business solution applications; desktop and server management tools; software development tools; and video games. The company also designs, manufactures, and sells devices, including personal computers, tablets, gaming and entertainment consoles, other devices, and related accessories.
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