MSFT's EV-based FCF yield is currently around 3.2% based on $75B normalized FCF. A true margin of safety for a software business requires at least a 4.0% yield, which translates to a target price of ~$260. Avoid buying MSFT at $370 as you are paying a massive premium for growth without a margin of safety. MSFT's growth rate could accelerate, justifying the lower FCF yield and premium valuation.
MSFT
HIGH
Mar 24, 16:10
Key Points
['Accumulating MSFT at current prices.', 'Buying the dip after a significant drawdown.']
March 24, 2026 at 16:10