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Microsoft has been one of the biggest stock market winners in recent decades, riding the technology waves of the personal computer, the internet and now artificial intelligence. Millions of Americans use the company’s products every day, whether it’s through Microsoft Office products such as Outlook or Excel, its popular Xbox gaming system, or its cloud computing business. Microsoft is also an investor in OpenAI, the creator of ChatGPT.
Microsoft is now among the most valuable companies in the world, sporting a market capitalization of about $2.9 trillion as of March 2025. The stock’s performance has made Microsoft co-founder Bill Gates and former CEO Steve Ballmer two of the richest people in the world, according to Bloomberg.
If you’d been around when Microsoft went public in March of 1986, you would have been wise to buy the stock. A $1,000 investment in Microsoft at its IPO is now worth an astounding sum.
Investing in Microsoft at its IPO: What $1,000 would be worth now
Microsoft went public on March 13, 1986, at a price of $21.00 per share. As of March 3, 2025, the shares traded for about $388. However, Microsoft has split its stock several times throughout its history and one original share is now equal to 288 shares, according to the company.
- A $1,000 investment at $21 per share would have resulted in 47 shares at the company’s IPO (fractional shares weren’t a thing in 1986).
- Those 47 shares are now the equivalent of 13,536 shares, which would be worth about $5.25 million at today’s prices.
Of course, the company has also paid dividends since 2003, which shareholders have enjoyed alongside the stock appreciation.
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The stock’s performance has been driven by the company’s underlying business results. In its fiscal 2015, Microsoft reported $93.6 billion in annual revenue, which grew to $245.1 billion in its fiscal 2024. Over the long term, you can’t have share price appreciation without strong business performance.
Here’s how Microsoft’s recent returns compare to those of the Vanguard S&P 500 ETF.
| 1-year total return (annualized) | 3-year total return (annualized) | 5-year total return (annualized) | 10-year total return (annualized) | |
|---|---|---|---|---|
| Vanguard S&P 500 ETF (VOO) | 18.5 percent | 12.5 percent | 16.8 percent | 12.9 percent |
| Microsoft (MSFT) | -3.3 percent | 10.7 percent | 20.4 percent | 25.3 percent |
Source: Morningstar (as of Feb. 28, 2025)
Investing in stocks: How to get started
It’d be nice if you could go back and invest in the best IPOs of the past 40 years, but unfortunately, that’s not how investing works. Investing is about what’s going to happen in the future, not what’s already taken place.
Trying to identify the best stock market performers can be an extremely rewarding undertaking, but it’s easier said than done. Fortunately, investors have a much simpler option that has produced solid results over the long term.
Index funds that track broad market indexes such as the S&P 500 allow you to hold a diversified basket of stocks without providing too much exposure to any single company. Index funds can be purchased through online brokers and are available at very low costs.
Many of the best financial advisors recommend investors use index funds to gain exposure to stocks, rather than trying to buy and sell individual stocks on their own. If you’re looking for a financial advisor in your area, Bankrate’s financial advisor matching tool can help.
Editorial Disclaimer: All investors are advised to conduct their own independent research into investment strategies before making an investment decision. In addition, investors are advised that past investment product performance is no guarantee of future price appreciation.
