Microsoft Shares Soar to Record on Earnings Boost From Cloud
If you look at the numbers their cash over the past few years have been relatively stable about ~24 billion in FCF. Now if we model that as a Perpetuity with 10% rate which has been historical rate of the market we get 24/.1=240 (not including inflation) if we add Net Tang Assets and some tax benefits if we write down goodwill we we end up with 56billion. However MSFT is trading for 450 billion. Where is this extra 150 billion coming from? Cloud has about 10% margin I don't see how the numbers add up.