Is Microsoft Corp. overvalued or undervalued?

As of 17 October 2025, the valuation grade for Microsoft Corp. has moved from fair to very attractive, indicating a significant improvement in its valuation outlook. The company appears to be undervalued, supported by a P/E ratio of 36, an EV to EBITDA ratio of 22.89, and a PEG ratio of 2.90, which are favorable compared to its peers.
In comparison, Oracle Corp. is considered expensive with a P/E of 51.69, while Salesforce, Inc. is attractive with a P/E of 33.28. This suggests that Microsoft offers a more compelling valuation relative to these competitors. Although specific return data is not available, the absence of negative performance relative to the S&P 500 reinforces the notion that Microsoft is positioned well in the market.