u/zUcCc_ ·
Reddit — r/ValueInvesting
· March 27, 2026 at 13:09
· ⬆ 25 pts
· 💬 48 comments
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Summary
The author argues that Microsoft (MSFT) is undervalued, drawing parallels to Google's (GOOG) position the prior year, where negative sentiment masked strong fundamentals.
The thesis is based on low valuation metrics (forward P/E under 20, PEG ~1), sustained double-digit profit growth, a strong balance sheet, insider buying, and significant revenue/earnings growth since 2021.
Quality assessment: Speculation with supporting data points. It's a persuasive opinion piece citing key metrics and qualitative observations (moat, switching costs), but lacks deep financial modeling or competitive analysis.
Score25
Comments48
Upvote %77%
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Yeah yeah same tickers blah blah anyway in my opinion MSFT is getting close to GOOG’s position last year.
Negative sentiment with people saying they are done, stagnant hate ect
Valuation metrics at lows(fwd pe under 20, peg around 1) all while still growing profits in the double digits at a \~39% margin
Huge cash reserves on the balance sheet
Insiders starting to buy
Meanwhile the price is approaching levels first reached in late 2021. Since then revenue is up about 80 billion annually and earnings up around 30 billion. Google had even crazier growth over that period.
Besides all that I use Microsoft products everyday at work and at home. Are they always the best, no, but I would say they get the job done which makes switching costly and not worth the time.
I am continuing to add on dips along with regular dca. That’s my quick and dirty analysis
MSFT's valuation (fwd P/E <20, PEG ~1) is at lows while the company maintains double-digit profit growth and a ~39% margin, with revenue up ~$80B and earnings up ~$30B since late 2021. The market's negative sentiment ("stagnant hate") has pushed the price back to late-2021 levels, creating a disconnect between price and fundamental business growth, similar to GOOG's setup the previous year. This disconnect, combined with a durable moat (high switching costs for products) and insider buying, presents a long-term value opportunity. Growth could slow more than expected, making the current valuation less attractive. Macroeconomic factors could pressure tech spending. AI investments may not yield expected returns.