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Microsoft Corporation (MSFT) vs Palantir Technologies Inc. (PLTR)

Microsoft Corporation and Palantir Technologies Inc. are both Software Infrastructure companies. Microsoft Corporation is the larger, with a market value of $3.94T against $386.4B — 10.2× the size. Microsoft Corporation trades at the lower P/E: 28.4× against 111×. Palantir Technologies Inc. grew revenue faster over the last twelve months: 87.1% against 17.9%. Palantir Technologies Inc. has the higher net margin (50.3% vs 41.2%) and the higher return on invested capital (265.3% vs 23.1%). Across the 22 metrics below, Palantir Technologies Inc. leads on 12 and Microsoft Corporation on 10.

Valuation

Metric MSFT PLTR Software Infrastructure median
P/E 28.42 110.58 24.97
P/S 11.71 55.91 2.74
P/B 8.62 35.91 2.90
Price to free cash flow 67.64 100.51 18.73
EV/EBITDA 19.61 118.35 14.30
EV/Sales 11.62 54.48 2.90
Earnings yield 3.52% 0.90% 0.00%
Free cash flow yield 1.48% 0.99% 0.35%

Profitability

Metric MSFT PLTR Software Infrastructure median
Gross margin 67.66% 84.74% 57.91%
Operating margin 47.10% 45.64% 0.00%
Net margin 41.17% 50.34% 0.00%
Free cash flow margin 17.31% 55.62% 0.00%
Return on equity 34.22% 40.69% 0.00%
Return on assets 20.15% 34.09% 0.00%
Return on invested capital 23.10% 265.31% 0.00%

Growth

Metric MSFT PLTR Software Infrastructure median
Revenue growth (TTM) 17.91% 87.06% 14.80%
EPS growth (last fiscal year) 31.60% 231.58% 17.35%
Revenue growth, 5-year CAGR 14.57% 32.58% 16.15%
Net income growth, 5-year CAGR 16.90% 0.00% 0.00%

Health

Metric MSFT PLTR Software Infrastructure median
Debt to equity 0.08 0.00 0.02
Current ratio 1.22 7.10 1.53
Net debt to EBITDA (0.19) (4.98) 0.05

Dividend

Metric MSFT PLTR Software Infrastructure median
Dividend yield 0.67% — 1.12%
Payout ratio 0.19 — 0.29

Size

Metric MSFT PLTR Software Infrastructure median
Market cap 3.94t 386.44b 644.83m

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