What if you invested $1000 in Microsoft 20 years ago?
The bottom line on Microsoft stock
According to Various Analysts, Microsoft Stock the Price Per Share at $420 by the End of 2024, $480 in 2025, $530 in 2026, $530 — $580 in 2027, $580 — $630 in 2028, $680 in 2029, $730 in 2030, $3,000 or Even $5,000 in 2035, $10,000 in 2040, $50,000 or Even $100,000 in 2050, $50k to $100k+ in 2060, According to ...
The closing price for Microsoft (MSFT) in 2000 was $13.43, on December 29, 2000. It was down 63% for the year. The latest price is $399.12.
The global cloud computing market is expected to generate $2.4 trillion in revenue by 2030, as compared to $569 billion in 2022. So Microsoft's improving share of this market bodes well for the company from a long-term perspective. However, this is not the only area where AI could drive solid growth for Microsoft.
Currently operating in multiple and diverse sectors, Microsoft is leading in gaming, AI, and cloud computing. It saw a substantial 18% revenue growth and a 33% improvement in net income. This makes Microsoft a great buy and investors should hold on to their MSFT stock forever.
Had you invested $1,000 in Microsoft 10 years ago, you would have turned a hefty profit by today. According to computations by CNBC, that modest amount would already have been worth $11,400 as of Nov. 9, 2023.
According to our calculations, a $1000 investment made in February 2014 would be worth $5,971.20, or a gain of 497.12%, as of February 5, 2024, and this return excludes dividends but includes price increases. Compare this to the S&P 500's rally of 178.17% and gold's return of 55.50% over the same time frame.
Amazon stock hit $2,000 per share for the first time Thursday.
The all-time high Microsoft stock closing price was 429.37 on March 21, 2024. The Microsoft 52-week high stock price is 430.82, which is 6.6% above the current share price. The Microsoft 52-week low stock price is 275.37, which is 31.9% below the current share price.
Considering that Microsoft is predicted to clock slower earnings growth than Amazon, we are going to assume that it will trade at a discount to Amazon and maintain a P/E multiple of 29 in five years based on its five-year average. So Microsoft stock could jump to $597 after five years.
What if I invested $1,000 in Microsoft in 1986?
Microsoft's return is even more impressive than Apple's, as it turned $1,000 invested in its 1986 IPO to $4.1 million now. However, Microsoft's stock ride was rather bumpy, as its stock turned $1,000 into nearly $600,0000 by the turn of the century.
Given the multiple ways Microsoft can profit from the AI revolution and other catalysts that could fuel its growth, I'd argue it's not too late to buy Microsoft.
As Dessai noted, Microsoft is trading at a higher multiple. Its trailing 12-month P/E ratio is 36.76, while Apple is trading at a ratio of 26.51, significantly lower. In simple terms what this means is that Microsoft must grow earnings much faster than Apple to achieve a similar return on investment.
Buffett has never owned Microsoft stock, and for a very good reason.
Stock | Sector | Trailing 12-month dividend yield* |
---|---|---|
International Business Machines Corp. (ticker: IBM) | Technology | 3.6% |
Abbott Laboratories (ABT) | Health care | 1.9% |
Stanley Black & Decker Inc. (SWK) | Industrials | 3.5% |
Atmos Energy Corp. (ATO) | Utilities | 2.7% |
Vanguard owns the most shares of Microsoft (MSFT).
Discount Rate | Present Value | Future Value |
---|---|---|
20% | $1,000 | $38,337.60 |
21% | $1,000 | $45,259.26 |
22% | $1,000 | $53,357.64 |
23% | $1,000 | $62,820.62 |
What does that look like on a brokerage statement? Check out the above chart and you'll see that if you invested $1,000 in Apple stock 20 years ago, it would today be worth almost $530,000. The same $1,000 invested in the S&P 500 would have theoretically turned into $6,186 over the same period.
9. If you had put $1,000 in Microsoft five years ago, your investment would have more than tripled in value to $3,408 as of Nov. 9. If you had invested $1,000 in Microsoft 10 years ago, it would have soared in value by more than 854% to $11,400 as of Nov.
As of March 28, 2024, the price of Tesla's stock was $175.79. Ten years ago, at market close on March 28, 2014, Tesla's stock was trading at $14.16 per share. This means that $10,000 invested in Tesla in March 2014 would be worth about $124,145 today.
How much is $300 a month into the S&P 500?
How a monthly investment of $300 could grow into $618,900. The S&P 500 returned 164% over the last decade, or about 10% per year. At that pace, $300 invested monthly in an S&P 500 index fund would be worth about $60,000 in one decade, $215,400 in two decades, and $618,900 in three decades.
If you had invested $1,000 in Google stock on Aug. 19, 2004, today, you would have $60,107. Likewise, if you had invested $1,000 in an index fund replicating Nasdaq, you would have $9,000. A similar $1,000 investment in an index fund that replicates the S&P 500 would be worth $4,815.
As a result, those who bought $10,000 worth of Amazon's stock in January 2013 would have $78,138.51 today, with an annual rate of return of 22.42%. The growth proves the importance of holding stocks over the long term, as doing so can safeguard your investment against short-term headwinds.
If you had invested $10,000 in Amazon stock on Jan. 1, 2000 (just before the dot-com crash), your investment would be worth over $470,000 today.
If Amazon maintains its current valuations, matches analysts' expectations, and grows its EPS at a CAGR of 20% from 2025 to 2030, its market cap would reach $5.5 trillion by the final year.
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