MicrosoftXSWX:MSFT 95 5-Year Yield-on-Cost % is 0.78 as of Jul. 02, 2026, which is 48% below its 10-year median of 1.51. GuruFocus rates XSWX:MSFT with a GF Score™ of 95/100 and a GF Value™ of CHF437.44 (Significantly Undervalued). The stock has 2 warning signs investors should review. Among 1,030 Software companies, Microsoft ranks worse than 67.28% on this metric.
Microsoft's yield on cost for the quarter that ended in Mar. 2026 was 0.78.
The historical rank and industry rank for Microsoft's 5-Year Yield-on-Cost % or its related term are showing as below:
XSWX:MSFT'
s 5-Year Yield-on-Cost % Range Over the Past 10 Years
Min: 0.78 Med: 1.51 Max: 4.32
Current: 0.78
During the past 13 years, Microsoft's highest Yield on Cost was 4.32. The lowest was 0.78. And the median was 1.51.
XSWX:MSFT's 5-Year Yield-on-Cost % is ranked worse than 67.28% of 1030
companies
in the Software industry
Industry Median: 3.115
vs XSWX:MSFT: 0.78
Microsoft (XSWX:MSFT) 5-Year Yield-on-Cost % Explanation
Of course the risk here is that the company may not raise its dividends as it did before. The key is to select the companies that can consistently raise its dividends. Usually companies with long history of raising dividends tend to do so.
Microsoft 5-Year Yield-on-Cost % Related Terms
XSWX:MSFT vs ORCL, PLTR, PANW: 5-Year Yield-on-Cost % Comparison
For the Software - Infrastructure subindustry, Microsoft's 5-Year Yield-on-Cost %, along with its competitors' market caps and 5-Year Yield-on-Cost % 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 5-Year Yield-on-Cost % vs Software Industry
For the Software industry and Technology sector, Microsoft's 5-Year Yield-on-Cost % distribution charts can be found below:
* The bar in red indicates where Microsoft's 5-Year Yield-on-Cost % falls into.
Dividend Yield % and dividend growth of a stock is an important factor for income investors. But if company A raises its dividend constantly faster than company B, company A's future dividend yield might be much higher than Company B's even if their yields are the same now and their stock prices do not change.
Yield on Cost assumes that you buy and the stock today, and hold it for 5 years. If the company raises it dividends at the same rate as it did over the past 5 years, the dividends investors receive annually in 5 years relative to the stock price today.
Therefore, Yield-on-Cost of Microsoft is calculated as
Microsoft (XSWX:MSFT) has a 5-Year Yield-on-Cost % of 0.78 as of Jul. 02, 2026. 5-Year Yield on Cost measures the expected yield based on a company's current yield and 5-year dividend growth. View historical data on Microsoft and its competitors. This is 48% below median its historical median of 1.51. Over the past decade, Microsoft's 5-Year Yield-on-Cost % has ranged from 0.78 to 4.32. According to the industry distribution chart, Microsoft ranks #693 out of 1030 companies in the Software industry, placing it in the top 67.3%.
Is Microsoft's 5-Year Yield-on-Cost % too high?
Microsoft's current 5-Year Yield-on-Cost % of 0.78 is 48% below median its 10-year median of 1.51. Over the past 10 years, this metric has ranged from a low of 0.78 to a high of 4.32. The Software industry median 5-Year Yield-on-Cost % is 3.12. Microsoft's value of 0.78 is 75% below this industry median. Based on the distribution chart, Microsoft ranks #693 out of 1030 companies in the Software industry, which is below the industry midpoint. 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 5-Year Yield-on-Cost % compare to ORCL and PLTR?
According to the Software industry distribution chart, Microsoft ranks #693 out of 1030 companies for 5-Year Yield-on-Cost %. This places Microsoft in the lower half of its industry. The industry median 5-Year Yield-on-Cost % is 3.12. Microsoft's value of 0.78 is 75% below this benchmark. Historically, Microsoft's own 5-Year Yield-on-Cost % has ranged from 0.78 to 4.32 over the past decade. While the company's 10-year median is 1.51 vs. the industry median of 3.12, Microsoft has consistently been below 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 5-Year Yield-on-Cost % for a Software company?
The median 5-Year Yield-on-Cost % among Software companies is 3.12, based on 1,030 companies in the industry. Companies in the top quartile (top 25%) have a 5-Year Yield-on-Cost % significantly above this median, while those in the bottom quartile fall well below. However, 5-Year Yield-on-Cost % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Microsoft's current 5-Year Yield-on-Cost % of 0.78 is 75% below 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 5-Year Yield-on-Cost % mean?
A high 5-Year Yield-on-Cost % can signal that a stock is expensive relative to its fundamentals. 5-Year Yield on Cost measures the expected yield based on a company's current yield and 5-year dividend growth. View historical data on Microsoft and its competitors. For the Software industry, the median 5-Year Yield-on-Cost % is 3.12 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Microsoft's current 5-Year Yield-on-Cost % is 0.78, which is 48% below median its own 10-year median of 1.51. 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 CHF437.44, compared to a current price of CHF300.00 — trading 31.4% below its estimated fair value. The current 5-Year Yield-on-Cost % is 0.78, which is 48% below median its 10-year median of 1.51 and 75% below the Software industry median of 3.12. 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 5-Year Yield-on-Cost % calculated?
5-Year Yield-on-Cost % is calculated from a company's financial statements. For Microsoft (XSWX:MSFT), the current 5-Year Yield-on-Cost % is 0.78 as of Jul. 02, 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 CHF300.00 is trading 31.4% below its estimated GF Value™ of CHF437.44.
GuruFocus considers Microsoft to be Significantly Undervalued.
Key valuation signals for XSWX:MSFT:
5-Year Yield-on-Cost %: 0.78 (48% below median its 10-year median of 1.51)
GF Value™: CHF437.44 vs. price of CHF300.00 (31.4% below fair value)
Industry Position: 75% below the Software median (#693 of 1030)
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
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5-Year Yield-on-Cost % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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