Comprehensive Stock Comparison
Compare Apple Inc. (AAPL) vs Microsoft Corporation (MSFT) Stock
Analyze side-by-side fundamentals, valuation, growth, and profitability to decide which stock is the better buy.
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Quick Verdict
| Category | Winner | Why |
|---|---|---|
| Growth | MSFT | 14.9% revenue growth vs AAPL's 6.4% |
| Value | MSFT | Lower P/E (23.8x vs 31.1x), PEG 1.27 vs 1.74 |
| Quality / Margins | MSFT | 39.0% net margin vs AAPL's 27.0% |
| Stability / Safety | MSFT | Beta 0.88 vs AAPL's 1.28, lower leverage |
| Dividends | MSFT | 0.8% yield, 19-year raise streak, vs AAPL's 0.4% |
| Momentum (1Y) | AAPL | +9.7% vs MSFT's -0.2% |
| Efficiency (ROA) | AAPL | 31.1% ROA vs MSFT's 17.9%, ROIC 64.5% vs 27.9% |
Who Each Stock Is For
Income & stability
Growth exposure
Long-term compounding (10Y)
Sleep-well-at-night portfolio
Valuation efficiency (growth/$)
Defensive / Recession hedge
Business Model
What each company does and how it makes money
Apple is a technology giant that designs and sells premium consumer electronics — most famously the iPhone — along with related software and services. It generates revenue primarily from hardware sales (roughly 80% of total) and a fast-growing services segment (around 20%) that includes the App Store, subscriptions, and licensing. Its key competitive advantage is a powerful ecosystem that locks users into its hardware, software, and services through seamless integration and high switching costs.
Microsoft is a global technology company that develops software, cloud services, and hardware products. It generates revenue primarily through cloud services like Azure (~40% of revenue), productivity software including Office 365 and Dynamics, and personal computing through Windows licensing and Surface devices. Its key competitive advantage is the deeply entrenched enterprise ecosystem—Windows and Office dominance creates a powerful network effect that drives adoption of its cloud and productivity suites.
Revenue Breakdown by Segment
How each company's revenue is distributed across its business units
Financial Metrics Comparison
Side-by-side fundamentals across 2 stocks. BestLagging
Financial Scorecard
MSFT leads in 3 of 6 categories (Financial Metrics, Valuation Metrics). AAPL leads in 2 (Profitability & Efficiency, Total Returns). 1 tied.
Financial Metrics (TTM)
AAPL and MSFT operate at a comparable scale, with $435.6B and $305.5B in trailing revenue. MSFT is the more profitable business, keeping 39.0% of every revenue dollar as net income compared to AAPL's 27.0%.
| Metric | AAPLApple Inc. | MSFTMicrosoft Corpora… |
|---|---|---|
| RevenueTrailing 12 months | $435.6B | $305.5B |
| EBITDAEarnings before interest/tax | $152.9B | $184.8B |
| Net IncomeAfter-tax profit | $117.8B | $119.3B |
| Free Cash FlowCash after capex | $123.3B | $77.4B |
| Gross MarginGross profit ÷ Revenue | +47.3% | +68.6% |
| Operating MarginEBIT ÷ Revenue | +32.4% | +46.7% |
| Net MarginNet income ÷ Revenue | +27.0% | +39.0% |
| FCF MarginFCF ÷ Revenue | +28.3% | +25.3% |
| Rev. Growth (YoY)Latest quarter vs prior year | +15.7% | +16.7% |
| EPS Growth (YoY)Latest quarter vs prior year | +18.3% | +59.8% |
Valuation Metrics
At 28.8x trailing earnings, MSFT trades at a 19% valuation discount to AAPL's 35.4x P/E. Adjusting for growth (PEG ratio), MSFT offers better value at 1.53x vs AAPL's 1.98x — a lower PEG means you pay less per unit of expected earnings growth.
| Metric | AAPLApple Inc. | MSFTMicrosoft Corpora… |
|---|---|---|
| Market CapShares × price | $3.88T | $2.92T |
| Enterprise ValueMkt cap + debt − cash | $3.97T | $2.95T |
| Trailing P/EPrice ÷ TTM EPS | 35.41x | 28.79x |
| Forward P/EPrice ÷ next-FY EPS est. | 31.15x | 23.84x |
| PEG RatioP/E ÷ EPS growth rate | 1.98x | 1.53x |
| EV / EBITDAEnterprise value multiple | 27.45x | 18.12x |
| Price / SalesMarket cap ÷ Revenue | 9.33x | 10.36x |
| Price / BookPrice ÷ Book value/share | 53.76x | 8.54x |
| Price / FCFMarket cap ÷ FCF | 39.33x | 40.74x |
Profitability & Efficiency
AAPL delivers a 133.5% return on equity — every $100 of shareholder capital generates $134 in annual profit, vs $31 for MSFT. MSFT carries lower financial leverage with a 0.18x debt-to-equity ratio, signaling a more conservative balance sheet compared to AAPL's 1.67x. On the Piotroski fundamental quality scale (0–9), AAPL scores 7/9 vs MSFT's 6/9, reflecting strong financial health.
| Metric | AAPLApple Inc. | MSFTMicrosoft Corpora… |
|---|---|---|
| ROE (TTM)Return on equity | +133.5% | +30.5% |
| ROA (TTM)Return on assets | +31.1% | +17.9% |
| ROICReturn on invested capital | +64.5% | +27.9% |
| ROCEReturn on capital employed | +69.6% | +29.7% |
| Piotroski ScoreFundamental quality 0–9 | 7 | 6 |
| Debt / EquityFinancial leverage | 1.67x | 0.18x |
| Net DebtTotal debt minus cash | $89.7B | $30.3B |
| Cash & Equiv.Liquid assets | $33.5B | $30.2B |
| Total DebtShort + long-term debt | $123.3B | $60.6B |
| Interest CoverageEBIT ÷ Interest expense | — | 56.44x |
Total Returns (with DRIP)
A $10,000 investment in AAPL five years ago would be worth $21,049 today (with dividends reinvested), compared to $17,186 for MSFT. Over the past 12 months, AAPL leads with a +9.7% total return vs MSFT's -0.2%. The 3-year compound annual growth rate (CAGR) favors AAPL at 21.9% vs MSFT's 17.3% — a key indicator of consistent wealth creation.
| Metric | AAPLApple Inc. | MSFTMicrosoft Corpora… |
|---|---|---|
| YTD ReturnYear-to-date | -2.4% | -16.8% |
| 1-Year ReturnPast 12 months | +9.7% | -0.2% |
| 3-Year ReturnCumulative with dividends | +81.2% | +61.3% |
| 5-Year ReturnCumulative with dividends | +110.5% | +71.9% |
| 10-Year ReturnCumulative with dividends | +1027.4% | +718.2% |
| CAGR (3Y)Annualised 3-year return | +21.9% | +17.3% |
Risk & Volatility
MSFT is the less volatile stock with a 0.88 beta — it tends to amplify market swings less than AAPL's 1.28 beta. A beta below 1.0 means the stock typically moves less than the S&P 500. AAPL currently trades 91.5% from its 52-week high vs MSFT's 70.7% drawdown — a narrower gap to the peak suggests stronger recent price momentum.
| Metric | AAPLApple Inc. | MSFTMicrosoft Corpora… |
|---|---|---|
| Beta (5Y)Sensitivity to S&P 500 | 1.28x | 0.88x |
| 52-Week HighHighest price in past year | $288.61 | $555.45 |
| 52-Week LowLowest price in past year | $169.21 | $344.79 |
| % of 52W HighCurrent price vs 52-week peak | +91.5% | +70.7% |
| RSI (14)Momentum oscillator 0–100 | 57.5 | 39.8 |
| Avg Volume (50D)Average daily shares traded | 40.9M | 28.4M |
Analyst Outlook
Wall Street rates AAPL as "Buy" and MSFT as "Buy". Consensus price targets imply 48.6% upside for MSFT (target: $584) vs 14.7% for AAPL (target: $303). For income investors, MSFT offers the higher dividend yield at 0.82% vs AAPL's 0.39%.
| Metric | AAPLApple Inc. | MSFTMicrosoft Corpora… |
|---|---|---|
| Analyst RatingConsensus buy/hold/sell | Buy | Buy |
| Price TargetConsensus 12-month target | $303.11 | $583.67 |
| # AnalystsCovering analysts | 109 | 78 |
| Dividend YieldAnnual dividend ÷ price | +0.4% | +0.8% |
| Dividend StreakConsecutive years of raises | 14 | 19 |
| Dividend / ShareAnnual DPS | $1.03 | $3.23 |
| Buyback YieldShare repurchases ÷ mkt cap | +2.3% | +0.6% |
Historical Charts
Charts are rendered on first load. Hover for details.
Chart 1Total Return — 5 Years (Rebased to 100)
| Stock | Mar 20 | Feb 26 | Change |
|---|---|---|---|
| Apple Inc. (AAPL) | 100 | 361.46 | +261.5% |
| Microsoft Corporati… (MSFT) | 100 | 245.02 | +145.0% |
Apple Inc. (AAPL) returned +110% over 5 years vs Microsoft Corporati… (MSFT)'s +72%. A $10,000 investment in AAPL 5 years ago would be worth $21,049 today (including dividends reinvested).
Chart 2Revenue Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| Apple Inc. (AAPL) | $215.6B | $416.2B | +93.0% |
| Microsoft Corporati… (MSFT) | $91.2B | $281.7B | +209.1% |
Apple Inc.'s revenue grew from $215.6B (2016) to $416.2B (2025) — a 7.6% CAGR. Microsoft Corporation's revenue grew from $91.2B (2016) to $281.7B (2025) — a 13.4% CAGR.
Chart 3Net Margin Trend — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| Apple Inc. (AAPL) | 21.2% | 26.9% | +27.0% |
| Microsoft Corporati… (MSFT) | 22.5% | 36.1% | +60.4% |
Apple Inc.'s net margin went from 21% (2016) to 27% (2025). Microsoft Corporation's net margin went from 23% (2016) to 36% (2025).
Chart 4P/E Ratio History — 9 Years
| Stock | 2017 | 2025 | Change |
|---|---|---|---|
| Apple Inc. (AAPL) | 18.4 | 36.4 | +97.8% |
| Microsoft Corporati… (MSFT) | 26.3 | 35.5 | +35.0% |
Apple Inc. has traded in a 13x–41x P/E range over 9 years; current trailing P/E is ~35x. Microsoft Corporation has traded in a 25x–48x P/E range over 9 years; current trailing P/E is ~29x.
Chart 5EPS Growth — 10 Years
| Stock | 2016 | 2025 | Change |
|---|---|---|---|
| Apple Inc. (AAPL) | 2.08 | 7.46 | +258.7% |
| Microsoft Corporati… (MSFT) | 2.1 | 13.64 | +549.5% |
Apple Inc.'s EPS grew from $2.08 (2016) to $7.46 (2025) — a 15% CAGR. Microsoft Corporation's EPS grew from $2.10 (2016) to $13.64 (2025) — a 23% CAGR.
Chart 6Free Cash Flow — 5 Years
Apple Inc. generated $99B FCF in 2025 (+6% vs 2021). Microsoft Corporation generated $72B FCF in 2025 (+28% vs 2021).
AAPL vs MSFT: Frequently Asked Questions
9 questions · data-driven answers · updated daily
01Is AAPL or MSFT a better buy right now?
Microsoft Corporation (MSFT) offers the better valuation at 28.8x trailing P/E (23.8x forward), making it the more compelling value choice. Analysts rate Apple Inc. (AAPL) a "Buy" — based on 109 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.
02Which has the better valuation — AAPL or MSFT?
On trailing P/E, Microsoft Corporation (MSFT) is the cheapest at 28.8x versus Apple Inc. at 35.4x. On forward P/E, Microsoft Corporation is actually cheaper at 23.8x. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: Microsoft Corporation wins at 1.27x versus Apple Inc.'s 1.74x — a reasonable growth-adjusted valuation.
03Which is the better long-term investment — AAPL or MSFT?
Over the past 5 years, Apple Inc. (AAPL) delivered a total return of +110.5%, compared to +71.9% for Microsoft Corporation (MSFT). A $10,000 investment in AAPL five years ago would be worth approximately $21K today (assuming dividends reinvested). Over 10 years, the gap is even starker: AAPL returned +1027% versus MSFT's +718.2%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.
04Which is safer — AAPL or MSFT?
By beta (market sensitivity over 5 years), Microsoft Corporation (MSFT) is the lower-risk stock at 0.88β versus Apple Inc.'s 1.28β — meaning AAPL is approximately 45% more volatile than MSFT relative to the S&P 500. On balance sheet safety, Microsoft Corporation (MSFT) carries a lower debt/equity ratio of 18% versus 167% for Apple Inc. — giving it more financial flexibility in a downturn.
05Which has better profit margins — AAPL or MSFT?
Microsoft Corporation (MSFT) is the more profitable company, earning 36.1% net margin versus 26.9% for Apple Inc. — meaning it keeps 36.1% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: MSFT leads at 45.6% versus 32.0% for AAPL. At the gross margin level — before operating expenses — MSFT leads at 68.8%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.
06Is AAPL or MSFT more undervalued right now?
The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential. By this metric, Microsoft Corporation (MSFT) is the more undervalued stock at a PEG of 1.27x versus Apple Inc.'s 1.74x. A PEG below 1.5 suggests fair-to-attractive pricing relative to expected growth. On forward earnings alone, Microsoft Corporation (MSFT) trades at 23.8x forward P/E versus 31.1x for Apple Inc. — 7.3x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for MSFT: 48.6% to $583.67.
07Which pays a better dividend — AAPL or MSFT?
All stocks in this comparison pay dividends. Microsoft Corporation (MSFT) offers the highest yield at 0.8%, versus 0.4% for Apple Inc. (AAPL).
08Is AAPL or MSFT better for a retirement portfolio?
For long-horizon retirement investors, Microsoft Corporation (MSFT) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 0.88), 0.8% yield, +718.2% 10Y return). Both have compounded well over 10 years (MSFT: +718.2%, AAPL: +1027%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.
09What are the main differences between AAPL and MSFT?
Both stocks operate in the Technology sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both. MSFT pays a dividend while AAPL does not, making them suitable for different income and tax situations. These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.
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