MSFT vs NTDOY: Which Is the Better Buy in 2026?
Last updated October 2026
Short answer
MSFT is the larger of the two ($3.93T market cap): the incumbent the market prices for continued execution (22.35x forward earnings, beta 1.10). NTDOY is the smaller challenger ($61.10B), cheaper on forward earnings (6.19x): more room to run, but more to prove. The real question is which set of drivers you believe, and whether owning one (or both) leaves you over-concentrated.
MSFT vs NTDOY: the tie-breaker metrics
Same yardstick, side by side (as of October 2026). Valuation lined up like this is most meaningful for two names in the same corner of the market, which these are. Figures are approximate; verify before investing.
| Metric | MSFT | NTDOY | What it tells you |
|---|---|---|---|
| Market cap | $3.93T | $61.10B | Size. The larger name is the incumbent; the smaller has more room to grow and more to prove. |
| Forward P/E | 22.35 | 6.19 | Valuation on next year's expected earnings, the same yardstick for both. Lower is cheaper for that growth; higher means the market is paying up. |
| Trailing P/E | 29.81 | 20.08 | Valuation on the last 12 months. A big drop from trailing to forward means the market expects earnings to jump, so more growth is already in the price. |
| Price vs 52-week range | 88% of range | 24% of range | Where today's price sits between the 52-week low and high. Near the high is momentum with less margin of safety; near the low is out of favor or a discount, depending on why. |
| Price / book | 8.88 | 3.31 | How much you pay over book value. Very high can signal an asset-light, high-return business or a rich price. |
Reading it: NTDOY is the cheaper of the two on forward earnings, but cheaper is not the same as better. Pair the valuation with growth (how far the forward P/E sits below the trailing P/E) and risk (beta) before you decide.
Before you buy: how MSFT and NTDOY affect your concentration
The metrics above tell you which is the marginally better business. The bigger risk for most people is not picking the slightly worse stock, it is over-concentrating. MSFT and NTDOY share themes, so owning both, or adding either to what you already hold, can quietly push a large share of your portfolio into one bet.
This is the part a generic comparison page cannot answer, because it depends on what you own. Connect your brokerage and Walnut shows your real, combined MSFT and NTDOY exposure, flags overlap with your existing positions, and tells you if adding one would tip you past a concentration you are comfortable with, read-only by default, with your login staying at your broker. Walnut is not an investment adviser.
What does Microsoft (MSFT) do?
Microsoft (MSFT) is one of the largest and most diversified technology companies in the world, operating across three reporting segments. Productivity and Business Processes includes Microsoft 365 (Office, Teams, Dynamics 365) and LinkedIn. Intelligent Cloud covers Azure, GitHub, server products, and enterprise services. More Personal Computing spans Windows, gaming (Xbox plus the acquired Activision Blizzard), Surface devices, and search via Bing. Azure is the second-largest cloud computing platform in the world behind AWS, and Microsoft 365 is the dominant productivity suite for businesses globally. AI is woven across all of it through the Copilot product line and a deep partnership with OpenAI, in which Microsoft is both the primary cloud provider and a major investor. The company was founded in 1975 by Bill Gates and Paul Allen, is headquartered in Redmond, Washington, and is led by CEO Satya Nadella (since 2014). Microsoft is consistently the largest or one of the two largest publicly traded US companies by market cap, with enormous recurring cash flow and a multi-decade dividend-growth streak.
What does Nintendo (NTDOY) do?
Nintendo (NTDOY) is one of the world's leading video game companies, built on a rare combination of hardware and the software and characters that run on it. It designs and sells dedicated game consoles, most recently the Switch 2 launched in June 2025, and publishes first-party games featuring some of the most valuable franchises in entertainment, including Mario, The Legend of Zelda, Pokemon, Animal Crossing, Splatoon, and Donkey Kong. Unlike pure software publishers, Nintendo controls both the platform and the biggest games on it, which lets it capture hardware sales, high-margin software, subscriptions through Nintendo Switch Online, and a growing stream of licensing, mobile, movies, and theme parks around its intellectual property. The business moves in console cycles: revenue and profit surge when a successful new system launches and its software library builds, then soften as the platform ages before the next machine arrives. For US investors, Nintendo trades as an over-the-counter American depositary receipt (NTDOY) that represents shares of the Japan-listed parent, so it carries yen currency exposure and thinner liquidity than a primary US listing. It is widely viewed as a way to own a durable stable of gaming IP alongside the swings of the hardware cycle.
MSFT vs NTDOY: how do they differ?
Both fit overlapping themes, but they are not interchangeable. The useful comparison is which set of drivers and risks you want exposure to.
- MSFT drivers: AI as the platform; Closing the gap with AWS in cloud.
- NTDOY drivers: Irreplaceable gaming intellectual property; The Switch 2 hardware cycle.
Which fits which kind of investor
A faster-growing, richer-valued name usually swings harder, so it suits a longer horizon and a higher tolerance for volatility; a steadier, more cash-generative business suits a more conservative or income-minded investor. The honest test is which set of risks you could hold through a drawdown: The largest open question is the return on AI capex: Microsoft is spending more than $50 billion a year on AI and cloud infrastructure, and if enterprise adoption is slower than expected the payback stretches out. For NTDOY, nintendo is a hit-driven, cyclical business.
MSFT or NTDOY: which should you pick?
Growth-minded investors who believe the theme has years to run tend to accept the richer multiple for more upside; value-minded investors lean toward the cheaper forward earnings and steadier profile. Pick MSFT if you believe its drivers more; NTDOY if you believe its. Many investors hold both, but since they share themes, that is a concentrated bet, not diversification. Decide deliberately and check overlap. For the full detail, see the MSFT and NTDOY guides.
MSFT vs NTDOY: the full fundamentals
MSFT. Microsoft trades at ~30x trailing and ~22x forward earnings as of October 16, 2026, lower than the ~35x of early 2026 because fiscal 2026 EPS grew faster than the share price. The premium rests on growth, durability, margins, and AI exposure through Azure, and holds as long as Azure keeps growing double digits and the AI capex earns a return. All figures are approximate and refresh quarterly; the next report is October 28, 2026.
NTDOY. At about $13.37 per ADR on October 16, 2026, Nintendo is valued near $62 billion and about 20 times trailing earnings, with roughly 1.97 trillion yen of cash and no debt cushioning that figure. The Switch 2 launch roughly doubled revenue to about 2.31 trillion yen in the year ended March 2026 (from about 1.16 trillion), the company then guided to lower Switch 2 unit sales for fiscal 2027, a typical pattern after a launch surge, and analysts expect full-year revenue near 2.33 trillion yen. Because NTDOY is an ADR, US-quoted figures move with the yen-dollar exchange rate as well as the business; figures are approximate and reported in yen.
Headline figures (approximate, October 2026): MSFT shows revenue (fy2026 ending june) ~$332 billion, up ~18% year over year, operating margin ~45%, among the highest of any company at Microsoft's scale, net income (fy2026) ~$134 billion, eps (ttm) ~$17.75; NTDOY shows revenue (ttm to june 2026) ~2.26 trillion yen; FY to March 2026 ~2.31 trillion yen, latest quarter (june 2026) revenue ~518B yen (-9.5% YoY), net income ~147B yen, net income (ttm) ~475 billion yen, operating margin (ttm) ~27.5%.
The bottom line: MSFT vs NTDOY
MSFT and NTDOY are related but distinct: same themes, different businesses and risks. Neither wins in the abstract; the right pick is whichever thesis you actually believe, sized so you are not over-concentrated in one theme. Walnut can show your combined MSFT and NTDOY exposure against your real portfolio. It is not an investment adviser.
Wondering how MSFT or NTDOY fits the portfolio you already own? Walnut is an AI investing app that connects your brokerage read-only and answers questions like that about your actual holdings: overlap, concentration, and how each position tracks the S&P 500. Compare the best AI portfolio analyzers or see the best AI investing apps in 2026.
Investing in Microsoft with AI
Connect the broker you already use and ask Walnut's AI how MSFT fits what you actually hold: whether you own it already through a fund, what it would do to your concentration, and how it has tracked the S&P 500. Read-only by default, and you approve anything before it reaches your broker.
FAQ
What is the difference between MSFT and NTDOY?
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Microsoft (MSFT) is one of the largest and most diversified technology companies in the world, operating across three reporting segments. Nintendo (NTDOY) is one of the world's leading video game companies, built on a rare combination of hardware and the software and characters that run on it. They show up together because they share investment themes, but they are different businesses, so the better fit depends on which thesis you are expressing.
Is MSFT or NTDOY the better stock?
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Neither is universally better. MSFT is the larger incumbent; NTDOY is the smaller challenger and looks cheaper on forward earnings. Walnut is informational, not investment advice. Compare what each does, the tie-breaker metrics above, and the risks, then decide which fits your thesis and what you already own.
Which is cheaper, MSFT or NTDOY?
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On forward P/E (as of October 2026), MSFT trades at 22.35x and NTDOY at 6.19x, so NTDOY is the cheaper of the two on next year's expected earnings. A lower multiple is not automatically the better buy: a richer valuation can be justified by faster growth, and a lower one can reflect real risk. Weigh the multiple against how fast each business is compounding.
Should you own both MSFT and NTDOY?
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Because they share themes, owning both concentrates you in that theme. That can be intentional (a focused bet) or accidental (less diversification than it looks). Walnut can show your combined exposure across both, and whether adding either over-concentrates you, before you buy.
What are the risks of MSFT vs NTDOY?
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MSFT: The largest open question is the return on AI capex: Microsoft is spending more than $50 billion a year on AI and cloud infrastructure, and if enterprise adoption is slower than expected the payback stretches out. Antitrust pressure is real, with the FTC and EU both active on Microsoft's stack over the years, and in October 2026 UK regulators put fresh scrutiny on cloud switching barriers at AWS and Microsoft. The concentrated dependence on OpenAI as the AI partner of choice cuts both ways, since OpenAI is also, increasingly, a competitor. Cloud is competitive (AWS leads, Google Cloud and Oracle are investing heavily), and the valuation, while not the highest in mega-cap tech, embeds confidence in durable double-digit growth that could compress if Azure decelerates. Capex intensity is the number to watch: operating cash flow was ~$183 billion on a trailing basis, but free cash flow after the data center buildout is far smaller, and total debt stands near $129 billion against ~$77 billion of cash. The stock's ~$349 to ~$554 52-week range shows how quickly sentiment on AI spending can swing. NTDOY: Nintendo is a hit-driven, cyclical business. Hardware sales rise and fall with the console cycle, and profits depend heavily on launching successful new systems and software on schedule. A weak console or a thin game lineup can pressure results, as can a maturing platform late in its cycle. Management guides conservatively and has trimmed Switch 2 unit forecasts, and rising component costs, such as memory chips, have pushed hardware prices higher, which can weigh on demand; US video game hardware sales fell to a 13-year low in data reported in October 2026 as prices rose on a memory and storage shortage. The stock is sensitive to the release slate as well: shares fell after a September 2026 Nintendo showcase that, by press accounts, investors judged on what was not announced. US tariffs add another layer, and in September 2026 Nintendo faced questions over how tariff refunds would reach customers. Competition from Sony, Microsoft, mobile gaming, and other entertainment is intense. For US investors, NTDOY is an over-the-counter ADR of a Japan-listed company, so it carries yen currency risk, thinner liquidity, wider spreads, and less frequent, differently formatted financial disclosure than a US primary listing.
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Walnut is informational, not investment advice. This page is descriptive and not a recommendation to buy or sell MSFT or NTDOY; figures are approximate and dated (as of October 2026). Verify current data before investing.