Analyzing Microsoft (NASDAQ:MSFT) and Trimble (NASDAQ:TRMB)

Microsoft (NASDAQ:MSFT) and Trimble (NASDAQ:TRMB) are both large-cap technology companies, but which is the better stock? We will compare the two companies based on the strength of their risk, institutional ownership, profitability, earnings, valuation, analyst recommendations and dividends.

Earnings & Valuation

This table compares Microsoft and Trimble”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Microsoft	$331.84 billion	11.18	$133.75 billion	$17.96	27.82
Trimble	$3.59 billion	3.87	$424.00 million	($0.49)	-121.37

Microsoft has higher revenue and earnings than Trimble. Trimble is trading at a lower price-to-earnings ratio than Microsoft, indicating that it is currently the more affordable of the two stocks.

Analyst Recommendations

This is a breakdown of recent ratings and recommmendations for Microsoft and Trimble, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Microsoft	0	5	42	0	2.89
Trimble	1	2	9	0	2.67

Microsoft presently has a consensus target price of $564.27, indicating a potential upside of 12.92%. Trimble has a consensus target price of $81.78, indicating a potential upside of 37.51%. Given Trimble’s higher probable upside, analysts plainly believe Trimble is more favorable than Microsoft.

Profitability

This table compares Microsoft and Trimble’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Microsoft	40.31%	31.98%	18.70%
Trimble	-2.77%	12.29%	7.67%

Volatility & Risk

Microsoft has a beta of 1.11, suggesting that its share price is 11% more volatile than the S&P 500. Comparatively, Trimble has a beta of 1.36, suggesting that its share price is 36% more volatile than the S&P 500.

Institutional and Insider Ownership

71.1% of Microsoft shares are owned by institutional investors. Comparatively, 93.2% of Trimble shares are owned by institutional investors. 0.0% of Microsoft shares are owned by company insiders. Comparatively, 0.6% of Trimble shares are owned by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Summary

Microsoft beats Trimble on 10 of the 14 factors compared between the two stocks.

About Microsoft

Microsoft Corporation develops and supports software, services, devices and solutions worldwide. The Productivity and Business Processes segment offers office, exchange, SharePoint, Microsoft Teams, office 365 Security and Compliance, Microsoft viva, and Microsoft 365 copilot; and office consumer services, such as Microsoft 365 consumer subscriptions, Office licensed on-premises, and other office services. This segment also provides LinkedIn; and dynamics business solutions, including Dynamics 365, a set of intelligent, cloud-based applications across ERP, CRM, power apps, and power automate; and on-premises ERP and CRM applications. The Intelligent Cloud segment offers server products and cloud services, such as azure and other cloud services; SQL and windows server, visual studio, system center, and related client access licenses, as well as nuance and GitHub; and enterprise services including enterprise support services, industry solutions, and nuance professional services. The More Personal Computing segment offers Windows, including windows OEM licensing and other non-volume licensing of the Windows operating system; Windows commercial comprising volume licensing of the Windows operating system, windows cloud services, and other Windows commercial offerings; patent licensing; and windows Internet of Things; and devices, such as surface, HoloLens, and PC accessories. Additionally, this segment provides gaming, which includes Xbox hardware and content, and first- and third-party content; Xbox game pass and other subscriptions, cloud gaming, advertising, third-party disc royalties, and other cloud services; and search and news advertising, which includes Bing, Microsoft News and Edge, and third-party affiliates. The company sells its products through OEMs, distributors, and resellers; and directly through digital marketplaces, online, and retail stores. The company was founded in 1975 and is headquartered in Redmond, Washington.

About Trimble

Trimble Inc. provides technology solutions that enable professionals and field mobile workers to enhance or transform their work processes worldwide. The company's Buildings and Infrastructure segment offers field and office software for project design and visualization; systems to guide and control construction equipment; software for 3D design and data sharing; systems to monitor, track, and manage assets, equipment, and workers; software to share and communicate data; program management solutions for construction owners; 3D conceptual design and modeling software; building information modeling software; enterprise resource planning, project management, and project collaboration solutions; integrated site layout and measurement systems; cost estimating, scheduling, and project controls solutions; and applications for sub-contractors and trades. Its Geospatial segment provides surveying and geospatial products, and geographic information systems. The company's Resources and Utilities segment offers precision agriculture products and services, such as guidance and positioning systems, including autonomous steering systems, automated and variable-rate application and technology systems, and information management solutions; manual and automated navigation guidance for tractors and other farm equipment; solutions to automate application of pesticide and seeding; water solutions; and agricultural software. Its Transportation segment offers solutions for long haul trucking and freight shipper markets; mobility solutions comprising route management, safety and compliance, end-to-end vehicle management, video intelligence, and supply chain communications; and fleet and transportation management systems, analytics, routing, mapping, reporting, and predictive modeling solutions. The company was formerly known as Trimble Navigation Limited and changed its name to Trimble Inc. in October 2016. Trimble Inc. was founded in 1978 and is headquartered in Westminster, Colorado.