Microsoft vs. Apple Stock: The Numbers Reveal a Clear Winner Heading Into H2 2026
May 22, 2026
Among the Magnificent Seven, Microsoft and Apple are not just heavyweights. They are the fight card.
Both are trillion-dollar tech giants that significantly shape how people live and work, and both remain major forces in the ongoing AI-driven market trend. But while they are often pitted against each other, their businesses are actually very different- and that’s what we’re looking to figure out today.
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So, between MSFT and AAPL, which stock looks like the better buy as we go into the second half of 2026?
Microsoft (MSFT)
The first Magnificent Seven company is Microsoft Corp., one of the world’s largest tech giants, with verticals spanning software, cloud computing, gaming, professional networking, and artificial intelligence. Best known for its Windows operating system, Microsoft is also behind some of the leading tech brands, including Office, Teams, Azure, LinkedIn, and Xbox, which are used by consumers, businesses, and governments worldwide.
Microsoft sits at a market cap of ~$3.1 trillion, and its stock has traded between $356 and $555 over the past 52 weeks. Today, its trading somewhere in the middle of that range, though the stock is down 13% YTD.
Apple (AAPL)
Next in the Magnificent Seven matchup is Apple Inc., another technology giant that has built one of the world’s most powerful ecosystems. It is best known for the iPhone, but it also has a strong, wide product portfolio that includes Macs, iPads, Apple Watches, AirPods, and software services. The result? An “Apple ecosystem”, in which these products work closely together, making it easier for customers to stay within the brand once they are already using it.
Apple’s dominance helped the company achieve a market cap of $4.4 trillion. Over the past 52 weeks, the stock traded between $193 and $304, and at the time of writing, it’s trading at the high end of that range. AAPL stock is also up 12% year-to-date.
That gives Apple the edge, at least in upside gained since the year started. But does that make it the better buy?
To answer that, we have to dig deeper.
Comparing revenue models: Microsoft vs Apple
Microsoft and Apple are both tech giants, but they make money in very different ways.
Microsoft’s income stream comes mainly from software, cloud services, business tools, gaming, and AI-related products. As an early tech innovator, it has products deeply integrated into workplaces, from Windows and Office to Teams, Azure, and LinkedIn, which gives the company a steady revenue from the different tools that businesses rely on every day.
Apple, meanwhile, makes most of its money from consumer technology. The iPhone remains its most important product, but the company also sells Macs, iPads, Apple Watches, AirPods, and a growing services business that includes iCloud, Apple Music, Apple TV+, AppleCare, and App Store-related revenue.
Financial comparisons
Now let’s look at their latest reported quarterly numbers:
|
Metric |
Microsoft |
Apple |
|
Sales |
$82.89 billion |
$111.18 billion |
|
Net Income |
$31.78 billion |
$29.58 billion |
|
Forward P/E |
24.91x |
34.19x |
Right off the bat, Microsoft reported less revenue than Apple, though it keeps more of it. Based on these values, Microsoft’s net margin is 38%, while Apple’s is just below 27%. Don’t get me wrong, both of these are strong margins. However, Microsoft remains more notable, primarily due to its focus on software and cloud subscription services, which are traditionally high-margin businesses.
Microsoft’s lead also extends to its valuation, with a forward P/E at just under 25x, well below Apple’s ~34x. This means that investors are paying less per dollar of Microsoft’s expected earnings than they are for Apple’s. It does not automatically make Microsoft the better stock, but it does make Microsoft more attractive.
Overall, Microsoft appears to have better fundamentals.
Dividend narrative
A company’s financial health is one thing, but being able to pay dividends is another.
At the time of publication, Microsoft has a 24-year streak of dividend increases, a year shy of becoming a Dividend Aristocrat. It pays $3.64 per share yearly, translating to a yield of around 0.87%
Meanwhile, Apple’s streak is lower, with 14 years of consecutive dividend increases. It pays a forward annual dividend of $1.08, translating to a yield of approximately 0.36%, which is also lower than Microsoft’s.
What does Wall Street think?
Microsoft’s dominance reflects Wall Street’s consensus: 48 analysts rate MSFT stock a “Strong Buy,” with mean and high targets suggesting 32%-62% upside potential.
Meanwhile, a consensus among 42 analysts rates AAPL stock a “Moderate Buy.” Its mean-to-high target prices suggest between 1% and 31% upside potential.
Verdict
Based on almost all objective data, Microsoft is the clear winner between these two stocks. It has the edge in performance, financials, dividends, analyst ratings, and high target prices- and everything that suggests it’s a better buy. Microsoft’s dominant exposure in the AI sector will also support its continued growth, at least while the boom is ongoing. That said, I wouldn’t shrug off Apple either. It is an innovative company that dominates the tech market by a wide margin, and its customers closely watch (and buy) its products released yearly… present company included.
On the date of publication, Rick Orford did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com
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