Switch to:
Microsoft Corp  (NAS:MSFT) Net-Net Working Capital: \$-2.57 Mil (As of Jun. 2017)

In calculating the Net-Net Working Capital (NNWC), Benjamin Graham assumed that a company's accounts receivable is only worth 75% its value, its inventory is only worth 50% of its value, but its liabilities have to be paid in full. In addition, Graham believed that preferred stock belongs on the liability side of the balance sheet, not as part of capital and surplus. This is a conservative way of estimating the company's value.

Microsoft Corp's net-net working capital per share for the quarter that ended in Jun. 2017 was \$-2.57.

Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Microsoft Corp Annual Data

 Jun08 Jun09 Jun10 Jun11 Jun12 Jun13 Jun14 Jun15 Jun16 Jun17 Net-Net Working Capital 3.32 2.32 2.12 0.85 -2.57

Microsoft Corp Quarterly Data

 Sep12 Dec12 Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Net-Net Working Capital 0.85 0.60 -2.75 -2.41 -2.57

Competitive Comparison
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap.

Calculation

Microsoft Corp's Net-Net Working Capital (NNWC) per share for the fiscal year that ended in Jun. 2017 is calculated as

 Net-Net Working Capital Per Share (A: Jun. 2017 ) = (Cash And Cash Equivalents + 0.75 * Accounts Receivable + 0.5 * Total Inventories - Total Liabilities - Preferred Stock / Shares Outstanding (Diluted Average) = (132981 + 0.75 * 19792 + 0.5 * 2181 - 168692 - 0) / 7708.00 = -2.57

Microsoft Corp's Net-Net Working Capital (NNWC) per share for the quarter that ended in Jun. 2017 is calculated as

 Net-Net Working Capital Per Share (Q: Jun. 2017 ) = (Cash And Cash Equivalents + 0.75 * Accounts Receivable + 0.5 * Total Inventories - Total Liabilities - Preferred Stock / Shares Outstanding (Diluted Average) = (132981 + 0.75 * 19792 + 0.5 * 2181 - 168692 - 0) / 7708.00 = -2.57

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

In calculating the Net-Net Working Capital (NNWC), Benjamin Graham assumed that a company's accounts receivable is only worth 75% its value, its inventory is only worth 50% of its value, but its liabilities have to be paid in full.

In addition, Graham believed that preferred stock belongs on the liability side of the balance sheet, not as part of capital and surplus. In "Security Analysis", preferred stock is dubbed "an imperfect creditorship position" that is best placed on the balance sheet alongside funded debt.

This is a conservative way of estimating the company's value.

Explanation

One research study, covering the years 1970 through 1983 showed that portfolios picked at the beginning of each year, and held for one year, returned 29.4 percent, on average, over the 13-year period, compared to 11.5 percent for the S&P 500 Index. Other studies of Graham's strategy produced similar results.

Benjamin Graham looked for companies whose market values were less than two-thirds of their net-net value. They are collected under our Net-Net screener. GuruFocus also publishes a monthly Net-Net newsletter.

Related Terms

From the Internet

###### 2 Winning Tech IPOs of 2017

- Fool 2017-10-21 10:46:00

###### Software Firms Like Oracle, Salesforce and Adobe Are Well-Positioned for Deals

- theStreet 2017-10-21 09:00:00

###### Why Microsoft shares could soon rise above the clouds

- theStreet 2017-10-21 08:29:00

###### Tech IPO Trends Worked In Mongo DB's Favor, But Could Work Against Stitch Fix

- theStreet 2017-10-21 07:35:00

###### Credit Suisse Breakup Effort Underway; Trump's FTC Takes Shape -- ICYMI

- theStreet 2017-10-20 19:26:00

- theStreet 2017-10-20 18:49:00

###### Three Takeaways from the Q3 Earnings Season

- Zacks 2017-10-20 15:25:00

###### Microsoft Earnings: The Wisdom of Clouds

- Barron's 2017-10-20 13:47:00

###### Buy Oracle Sooner Rather Later

- Seekingalpha 2017-10-20 13:12:07

###### Tech earnings: The new gadgets that will matter this holiday season

- MarketWatch 2017-10-20 12:18:00

###### Will High Costs Mar Citrix Systems' (CTXS) Q3 Earnings?

- Zacks 2017-10-20 10:21:00

###### Tech Companies Set to Launch a Coalition to Support Dreamers

- theStreet 2017-10-20 09:36:00

###### PayPal (PYPL) Tops Q3 Earnings Estimates, Raises 2017 View

- Zacks 2017-10-20 09:30:00

###### The Zacks Analyst Blog Highlights: Csra, Amazon, Microsoft and ServiceNow

- Zacks 2017-10-20 08:59:00

###### HP Enterprise's disappointing outlook could lead activists to push for a sale

- theStreet 2017-10-20 07:30:00

###### Dgi Diy Q3 2017 Portfolio Update

- Seekingalpha 2017-10-20 07:26:52

###### Wall Street Breakfast Tax Reform Steps Move Dollar Treasuries

- Seekingalpha 2017-10-20 06:55:15

###### Samsung to Open Giant London Showroom to Rival Apple

- Bloomberg 2017-10-20 06:47:06

###### Tech companies to lobby for immigrant 'Dreamers' to remain in the US

- cnbc 2017-10-20 06:45:59

###### EXCLUSIVE: Alphabetâ€™s \$GOOGL, \$MSFT, \$FB, \$UBER, \$IBM join group lobbying for immigrant 'Dreamers' to remain in U.Sâ€¦

- Reuters 2017-10-20 05:37:04

###### EXCLUSIVE: Alphabetâ€™s \$GOOGL, \$MSFT, \$FB, \$UBER, \$IBM join group lobbying for immigrant 'Dreamers' to remain in U.Sâ€¦

- Reuters 2017-10-20 02:09:07

###### EXCLUSIVE: Alphabetâ€™s \$GOOGL, \$MSFT, \$FB, \$UBER, \$IBM join group lobbying for immigrant 'Dreamers' to remain in U.Sâ€¦

- Reuters 2017-10-19 22:50:19

###### The Most Important Virtual Reality Tech Coming in 2018

- Fool 2017-10-19 21:07:00

###### Microsoft market cap hits \$600 billion for first time since dot-com boom

- MarketWatch 2017-10-19 17:38:00

###### Amazon’s second headquarters could be curative or curse for winning city’s real-estate market

- MarketWatch 2017-10-19 16:38:00

Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to \$400 per referral. ( Learn More)