Trade-Ideas: Microsoft (MSFT) Is Today's Post-Market Leader Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Microsoft ( MSFT) as a post-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified Microsoft as such a stock due to the following factors:

  • MSFT has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $1.3 billion.
  • MSFT is up 2.8% today from today's close.

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More details on MSFT:

Microsoft Corporation develops, licenses, and supports software, services, and hardware devices. Its Windows division offers Windows operating system; Windows Services suite of applications and Web services, including Outlook.com and SkyDrive; Surface RT and Pro devices; and PC accessories. The stock currently has a dividend yield of 2.8%. MSFT has a PE ratio of 14.7. Currently there are 10 analysts that rate Microsoft a buy, 1 analyst rates it a sell, and 14 rate it a hold.

The average volume for Microsoft has been 37.7 million shares per day over the past 30 days. Microsoft has a market cap of $331.9 billion and is part of the technology sector and computer software & services industry. The stock has a beta of 0.68 and a short float of 1.2% with 2.89 days to cover. Shares are up 6.1% year-to-date as of the close of trading on Wednesday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Microsoft as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, notable return on equity, attractive valuation levels and solid stock price performance. We feel these strengths outweigh the fact that the company shows weak operating cash flow.

Highlights from the ratings report include:
  • MSFT's revenue growth has slightly outpaced the industry average of 11.6%. Since the same quarter one year prior, revenues rose by 14.3%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • Although MSFT's debt-to-equity ratio of 0.27 is very low, it is currently higher than that of the industry average. Along with this, the company maintains a quick ratio of 2.96, which clearly demonstrates the ability to cover short-term cash needs.
  • Current return on equity exceeded its ROE from the same quarter one year prior. This is a clear sign of strength within the company. When compared to other companies in the Software industry and the overall market, MICROSOFT CORP's return on equity exceeds that of the industry average and significantly exceeds that of the S&P 500.
  • Investors have apparently begun to recognize positive factors similar to those we have mentioned in this report, including earnings growth. This has helped drive up the company's shares by a sharp 39.45% over the past year, a rise that has exceeded that of the S&P 500 Index. Regarding the stock's future course, although almost any stock can fall in a broad market decline, MSFT should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.
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