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Category: Intel (INTC) and Microsoft (MSFT)
Date: 27 January 2021 Stock price of Intel (INTC): $55.21 Stock price of Microsoft (MSFT): $232.33 In our latest battle of series we take a look at the battle of the tech giants. Microsoft (MSFT) vs Intel (INTC). Which company's stock has been the best performer over the last 5 years and which firms financial numbers shows its best placed to outperform in the future.
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All of these firms are active in the banking and financial services sector in the USA. And their stock price trends look very similar, but the stock price returns are however very different. JPMorgan's stock was by far the best performer and Wells Fargo by far the worst performer over the last 5 years "
More About Microsoft (MSFT)
Microsoft is a technology company whose mission is to empower every person and every organization on the planet to achieve more. We strive to create local opportunity, growth, and impact in every country around the world. Our platforms and tools help drive small business productivity, large business competitiveness, and public-sector efficiency. They also support new startups, improve educational and health outcomes, and empower human ingenuity.
We continue to transform our business to lead in the new era of the intelligent cloud and intelligent edge. We bring technology and products together into experiences and solutions that unlock value for our customers. In this next phase of innovation, computing is more powerful and ubiquitous from the cloud to the edge. Artificial intelligence (“AI”) capabilities are rapidly advancing, fueled by data and knowledge of the world. Physical and virtual worlds are coming together with the Internet of Things (“IoT”) and mixed reality to create richer experiences that understand the context surrounding people, the things they use, the places they go, and their activities and relationships. A person’s experience with technology spans a multitude of devices and has become increasingly more natural and multi-sensory with voice, ink, and gaze interactions.
The data below refers to the latest quarter unless specified otherwise:
Our latest stock valuation of Microsoft: $183.60
We continue to transform our business to lead in the new era of the intelligent cloud and intelligent edge. We bring technology and products together into experiences and solutions that unlock value for our customers. In this next phase of innovation, computing is more powerful and ubiquitous from the cloud to the edge. Artificial intelligence (“AI”) capabilities are rapidly advancing, fueled by data and knowledge of the world. Physical and virtual worlds are coming together with the Internet of Things (“IoT”) and mixed reality to create richer experiences that understand the context surrounding people, the things they use, the places they go, and their activities and relationships. A person’s experience with technology spans a multitude of devices and has become increasingly more natural and multi-sensory with voice, ink, and gaze interactions.
The data below refers to the latest quarter unless specified otherwise:
- Revenue: $43.04 billion (up from $36.9 billion from the same quarter of the previous year)
- Revenue increased by 16.6% over the last 12 months
- Cost of revenue : $14.14 billion (up from $12.36 billion for the same quarter of the previous year)
- Cost of revenue increased by 14.4% over the last 12 months
- Net income: $15.46 billion (up from $11.649 million for the same quarter of the previous year)
- Diluted earnings per share: $2.03 (up from $1.51 for the same quarter of the previous year)
- Diluted weighted-average shares outstanding: 7.61 billion (down from 7.69 billion for the same quarter of the previous year)
- PE ratio of Microsoft (MSFT): 29
- Cash and cash equivalents: $14.4 billion
- Cash and cash equivalents per share: $1.89
- Cash and cash equivalents makes up 0.81% of Microsoft's current market capital
- Cash and cash equivalents makes up 4.7% of Microsoft's total assets
- Cash and cash equivalents per share: $1.89
- Accounts receivable: $27.312 billion
- Accounts receivable makes up 8.9% of Microsoft total assets
- Total stockholders' equity of Microsoft: $130.236 billion
- Stockholders' equity per share: $17.11
- So Microsoft (MSFT) is trading at 13.6 times its stockholders equity per share which is WELL outside the expected range of between 2 and 5 times that most firms tend to trade at
- Stockholders' equity per share: $17.11
Our latest stock valuation of Microsoft: $183.60
More About Intel Corporation (INTC)
Founded in 1968, Intel’s technology has been at the heart of computing breakthroughs. We are an industry leader, creating world-changing technology that enables global progress and enriches lives. We stand at the brink of several technology inflections—artificial intelligence (AI), 5G network transformation, and the rise of the intelligent edge—that together will shape the future of technology. Silicon and software drive these inflections, and Intel is at the heart of it all.
The data below refers to Intel's latest quarterly earnings
Our latest stock valuation of Intel : $72.20
The data below refers to Intel's latest quarterly earnings
- Revenue: $20 billion (down from $20.2 billion)
- Revenue declined by 1% over the last 12 month
- Net income: $5.9 billion (down from $6.9million for the same quarter of the previous year)
- Diluted earnings per share: $1.42 (up from $1.58 for the same quarter of the previous year)
- Diluted weighted-average shares outstanding: 7.61 billion (down from 7.69 billion for the same quarter of the previous year)
- PE ratio of Intel (INTC): 9.8
- Cash and cash equivalents: $5.86 billion
- Cash and cash equivalents per share: $1.42
- Cash and cash equivalents makes up 2.6% of Intel's current market capital
- Cash and cash equivalents makes up 3.8% of Intel's total assets
- Cash and cash equivalents per share: $1.42
- Accounts receivable: $6.782 billion
- Accounts receivable makes up 4.4% of Intel's total assets
- Total stockholders' equity of Intel: $81.038 billion
- Stockholders' equity per share: $19.67
- So Intel (INTC) is trading at 2.8 times its stockholders equity per share which is within the expected range of between 2 and 5 times that most firms tend to trade at
- Stockholders' equity per share: $19.67
Our latest stock valuation of Intel : $72.20
Microsoft (MSFT) stock vs Intel (INTC) stock over the last 5 years.
The image below shows the stock price performance of Microsoft (MSFT) and Intel (INTC) over the last 5 years. Both of these firms are tech giants, but the returns provided by their respective stocks are very different. The summary below shows the returns provided by Microsoft and Intel over the lat 5 years.
The stock of Microsoft has easily outperformed that of Intel over the last 5 years.
- Microsoft: 343.1%
- Intel: 88.1%
The stock of Microsoft has easily outperformed that of Intel over the last 5 years.
Financial metrics comparison of the big banks
One of our key metrics is the Price to Stockholders equity per share ratio. When looking at this we find the following:
Based on this metric Intel Corp offers far more value than Microsoft. Most firms tend to trade at a ratio of between 2 and 5 times. While Intel trades within this range the stock if Microsoft is trading well outside this expected range. So what is the stockholders equity per share you ask? Well if a firm sells all assets, pays all its debts and distributes the rest to its stockholders, the stockholders equity per share shows what each stockholders will get. Thus the higher this ratio the less you will get out per stock compared to what you are paying for it. So Microsofit that is trading at 13.5 times it stockholders equity you will only get 7.5% of its current stock price out of they were to sell all assets, pay all debt and distribute the rest to stockholders. In the case of Intel you would get out 35.7% of its current stock price
Next up cash as percentage of stock price:
Next up lets take a look at the percentage cash on the balance sheet makes up of each group's total assets:
Looking at the cash position of the three firms Microsoft has the strongest cash position (as a percentage of their total assets). The cash per share gives an indication of if investors were to buy the stock now, how much of that stock price is made up by cash on their balance sheet. In this case its Intel that comes out on top with 2.6% of their current stock price being made up by cash.
Next the overused but still useful metric, the Price to Earnings Ratio (PE):
So Intel has the lower PE ratio of the two firms looked at in this comparison
Price/Stock Valuation ratio:
Based on the Price/Stock valuation metric it is Intel that comes out as the winner as its trading at well below our stock price target while Microsoft is trading at well above our stock valuation for it.
If we have to chose one of these two tech giants, based on their stock price performance, their financial results and other financial ratios we rate the stock of Intel as the winner.
Intel's PE ratio is the lowest, its trading at closer to its stockholders equity per share, and its trading at a discount to our stock price target. It also has a better cash as percentage of market capital ratio than that of Microsoft. What counts in Microsoft's favour is the fact that its cash as percentage of total assets is better. But Microsoft is trading at a far higher PE ratio, its trading far away from its stockholders equity per share and its trading at a premium to our stock valuation for it.
So from all the above in the battle between Microsoft and Intel its Intel that is declared the winner
- Price/Stockholders equity per share for Microsoft: 13.5
- Price/Stockholders equity per share for Intel Corp : 2.8
Based on this metric Intel Corp offers far more value than Microsoft. Most firms tend to trade at a ratio of between 2 and 5 times. While Intel trades within this range the stock if Microsoft is trading well outside this expected range. So what is the stockholders equity per share you ask? Well if a firm sells all assets, pays all its debts and distributes the rest to its stockholders, the stockholders equity per share shows what each stockholders will get. Thus the higher this ratio the less you will get out per stock compared to what you are paying for it. So Microsofit that is trading at 13.5 times it stockholders equity you will only get 7.5% of its current stock price out of they were to sell all assets, pay all debt and distribute the rest to stockholders. In the case of Intel you would get out 35.7% of its current stock price
Next up cash as percentage of stock price:
- Cash as percentage of stock price for Microsoft: 0.81%
- Cash as percentage of stock price for Intel Corp : 2.6%
Next up lets take a look at the percentage cash on the balance sheet makes up of each group's total assets:
- Cash as percentage of stock price for Microsoft: 4.7%
- Cash as percentage of stock price for Intel Corp : 3.8%
Looking at the cash position of the three firms Microsoft has the strongest cash position (as a percentage of their total assets). The cash per share gives an indication of if investors were to buy the stock now, how much of that stock price is made up by cash on their balance sheet. In this case its Intel that comes out on top with 2.6% of their current stock price being made up by cash.
Next the overused but still useful metric, the Price to Earnings Ratio (PE):
- PE for Microsoft:29
- PE for Intel Corp : 9.8
So Intel has the lower PE ratio of the two firms looked at in this comparison
Price/Stock Valuation ratio:
- Price/Stock Valuation for Microsoft: 1.27
- Price/Stock Valuation for Intel Corp : 0.76
Based on the Price/Stock valuation metric it is Intel that comes out as the winner as its trading at well below our stock price target while Microsoft is trading at well above our stock valuation for it.
If we have to chose one of these two tech giants, based on their stock price performance, their financial results and other financial ratios we rate the stock of Intel as the winner.
Intel's PE ratio is the lowest, its trading at closer to its stockholders equity per share, and its trading at a discount to our stock price target. It also has a better cash as percentage of market capital ratio than that of Microsoft. What counts in Microsoft's favour is the fact that its cash as percentage of total assets is better. But Microsoft is trading at a far higher PE ratio, its trading far away from its stockholders equity per share and its trading at a premium to our stock valuation for it.
So from all the above in the battle between Microsoft and Intel its Intel that is declared the winner