MicrosoftXSWX:MSFT +3.87%95 Return-on-Tangible-Asset is 23.39% as of Mar. 2026, which is 13% above its 10-year median of 20.70. GuruFocus rates XSWX:MSFT with a GF Score™ of 95/100 and a GF Value™ of CHF447.13 (Significantly Undervalued). The stock has 2 warning signs investors should review. Among 2,883 Software companies, Microsoft ranks better than 94.42% on this metric.
Return-on-Tangible-Asset is calculated as Net Income divided by its average total tangible assets. Total tangible assets equals to Total Assets minus Intangible Assets. Microsoft's annualizedNet Income for the quarter that ended in Mar. 2026 was CHF100,075 Mil. Microsoft's average total tangible assets for the quarter that ended in Mar. 2026 was CHF427,913 Mil. Therefore, Microsoft's annualized Return-on-Tangible-Asset for the quarter that ended in Mar. 2026 was 23.39%.
The historical rank and industry rank for Microsoft's Return-on-Tangible-Asset or its related term are showing as below:
XSWX:MSFT'
s Return-on-Tangible-Asset Range Over the Past 10 Years
Min: 7.89 Med: 20.7 Max: 25.87
Current: 25.32
During the past 13 years, Microsoft's highest Return-on-Tangible-Asset was 25.87%. The lowest was 7.89%. And the median was 20.70%.
XSWX:MSFT's Return-on-Tangible-Asset is ranked better than 94.42% of 2883
companies
in the Software industry
Industry Median: 2.02
vs XSWX:MSFT: 25.32
Microsoft (XSWX:MSFT) Return-on-Tangible-Asset Explanation
Return-on-Tangible-Asset measures the rate of return on the average total tangible assets (total assets minus intangible assets). Tangible means physical in nature. Intangible Assets are assets that are not physical in nature, and typically "derive their value from legal or intellectual rights." Return-on-Tangible-Asset measures a firm's efficiency at generating profits from its tangible assets. It shows how well a company uses what it has to generate earnings. Return-on-Tangible-Assets can vary drastically across industries. Therefore, Return-on-Tangible-Asset should not be used to compare companies in different industries.
Be Aware
Like ROE and ROA, Return-on-Tangible-Asset is calculated with only 12 months data. Fluctuations in the companys earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective. Return-on-Tangible-Asset can be affected by events such as stock buyback or issuance, and by a companys tax rate and its interest payment. Return-on-Tangible-Asset may not reflect the true earning power of the assets. A more accurate measurement is ROC % (ROC).
Many analysts argue the higher return the better. Buffett states that really high Return-on-Tangible-Asset may indicate vulnerability in the durability of the competitive advantage.
Microsoft Return-on-Tangible-Asset Related Terms
Microsoft Return-on-Tangible-Asset Historical Data
* Premium members only.
The historical data trend for Microsoft's Return-on-Tangible-Asset can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
XSWX:MSFT vs ORCL, PLTR, PANW: Return-on-Tangible-Asset Comparison
For the Software - Infrastructure subindustry, Microsoft's Return-on-Tangible-Asset, along with its competitors' market caps and Return-on-Tangible-Asset data, can be viewed below:
* 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. Note that "N/A" values will not show up in the chart.
Microsoft Return-on-Tangible-Asset vs Software Industry
For the Software industry and Technology sector, Microsoft's Return-on-Tangible-Asset distribution charts can be found below:
* The bar in red indicates where Microsoft's Return-on-Tangible-Asset falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
In the calculation of annual Return-on-Tangible-Asset, the net income of the last fiscal year and the average total tangible assets over the fiscal year are used. In calculating the quarterly data,
the Net Income data used here is four times the quarterly (Mar. 2026) net income data.
What does a Return-on-Tangible-Asset of 23.39% mean?
Microsoft (XSWX:MSFT) has a Return-on-Tangible-Asset of 23.39% as of Mar. 2026. Return on tangible assets is the ratio of current-period net income to average two-period tangible assets. View historical data on Microsoft and its competitors. This is 13% above median its historical median of 20.70. Over the past decade, Microsoft's Return-on-Tangible-Asset has ranged from 7.89 to 25.87. According to the industry distribution chart, Microsoft ranks #161 out of 2883 companies in the Software industry, placing it in the top 5.6%.
Is Microsoft's Return-on-Tangible-Asset too high?
Microsoft's current Return-on-Tangible-Asset of 23.39% is 13% above median its 10-year median of 20.70. Over the past 10 years, this metric has ranged from a low of 7.89 to a high of 25.87. The Software industry median Return-on-Tangible-Asset is 2.02. Microsoft's value of 23.39% is 1057.9% above this industry median. Based on the distribution chart, Microsoft ranks #161 out of 2883 companies in the Software industry, which is in the top quartile — a strong position relative to peers. Overall, Microsoft has a GF Score™ of 95/100 and is considered Significantly Undervalued, reflecting its overall financial health beyond just this single metric.
How does Microsoft's Return-on-Tangible-Asset compare to ORCL and PLTR?
According to the Software industry distribution chart, Microsoft ranks #161 out of 2883 companies for Return-on-Tangible-Asset. This places Microsoft in the top 6% of its industry — outperforming the majority of peers. The industry median Return-on-Tangible-Asset is 2.02. Microsoft's value of 23.39% is 1057.9% above this benchmark. Historically, Microsoft's own Return-on-Tangible-Asset has ranged from 7.89 to 25.87 over the past decade. While the company's 10-year median is 20.70 vs. the industry median of 2.02, Microsoft has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Return-on-Tangible-Asset for a Software company?
The median Return-on-Tangible-Asset among Software companies is 2.02, based on 2,883 companies in the industry. Companies in the top quartile (top 25%) have a Return-on-Tangible-Asset significantly above this median, while those in the bottom quartile fall well below. However, Return-on-Tangible-Asset should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Microsoft's current Return-on-Tangible-Asset of 23.39% is 1057.9% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Return-on-Tangible-Asset mean?
A high Return-on-Tangible-Asset can signal that a stock is expensive relative to its fundamentals. Return on tangible assets is the ratio of current-period net income to average two-period tangible assets. View historical data on Microsoft and its competitors. For the Software industry, the median Return-on-Tangible-Asset is 2.02 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Microsoft's current Return-on-Tangible-Asset is 23.39%, which is 13% above median its own 10-year median of 20.70. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Microsoft stock overvalued right now?
Based on GuruFocus' analysis, Microsoft (XSWX:MSFT) is currently considered Significantly Undervalued. The stock's GF Value™ is CHF447.13, compared to a current price of CHF311.60 — trading 30.3% below its estimated fair value. The current Return-on-Tangible-Asset is 23.39%, which is 13% above median its 10-year median of 20.70 and 1057.9% above the Software industry median of 2.02. Microsoft's overall GF Score™ is 95/100 with 2 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Return-on-Tangible-Asset calculated?
Return-on-Tangible-Asset is calculated from a company's financial statements. For Microsoft (XSWX:MSFT), the current Return-on-Tangible-Asset is 23.39% as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Microsoft (XSWX:MSFT) Overvalued in 2026?
Based on GuruFocus' analysis, Microsoft stock appears to be undervalued.
The current stock price of CHF311.60 is trading 30.3% below its estimated GF Value™ of CHF447.13.
GuruFocus considers Microsoft to be Significantly Undervalued.
Key valuation signals for XSWX:MSFT:
Return-on-Tangible-Asset: 23.39% (13% above median its 10-year median of 20.70)
GF Value™: CHF447.13 vs. price of CHF311.60 (30.3% below fair value)
Industry Position: 1057.9% above the Software median (#161 of 2883)
No single metric tells the full story. See the XSWX:MSFT stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Microsoft develops and licenses consumer and enterprise software. It is known for its Windows operating systems and Office productivity suite. The company is organized into three equally sized broad segments: productivity and business processes (legacy Microsoft Office, cloud-based Office 365, Exchange, SharePoint, Skype, LinkedIn, Dynamics), intelligence cloud (infrastructure- and platform-as-a-service offerings Azure, Windows Server OS, SQL Server), and more personal computing (Windows Client, Xbox, Bing search, display advertising, and Surface laptops, tablets, and desktops).
95GF Score
Get the complete analysis for XSWX:MSFT
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