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Here's Why Microsoft Is an Attractive Investment Now
Posted by: tyokunbo (IP Logged)
Date: June 13, 2014 09:51PM
Microsoft (MSFT) looks solid for the fiscal year 2014. The tech giant’s earnings have increased so far, and the company hopes to build products that people love to use. Microsoft hasn’t shown any weakness, even though investors are seen building their hopes around the stock backed by robust performances of rivals like Google (GOOG) and Apple (AAPL). The competition from rivals has made Microsoft position itself to benefit from mobile and cloud markets. And it wasn’t surprising when Microsoft turned in solid results in the recent quarterly report.
Microsoft expects its operating expenses to rise 4% for the full year, but the company seems covered, which is why we should be concentrated on its prospects going forward. The company has witnessed tremendous growth in cloud services. Its commercial cloud business more than doubled on a year-on-year basis, with both Azure and Office 365 performing extremely well. Despite the weakness in the PC market, Microsoft had a double-digit growth in Windows Server Premium. It has been growing its share in the U.S. search market. Search revenues increased by 38% in the last quarter.
However, Microsoft faces tough competition from tech giants such as Apple and Google. Microsoft’s rivals continue to make their presence felt in many areas of the tech sector. Apple has acquired at least 23 firms over the last five quarters. For its fiscal year 2013, Apple reported $496 million in net payments made in connection with business acquisitions. Companies that Apple was reported to have purchased during the period include WiFiSlam, Locationary, HopStop and others. These are to boost its future revenues.
One key growth driver that is supplementing Microsoft’s growth in a big way is the business customers segment. Customers continue to make Windows their overwhelming platform of choice. Windows Pro and Windows Licensing revenues grew in the recent quarter. Also, Microsoft’s U.S. search share grew to 18.6%. In addition, Microsoft Office 365 is now on an annual revenue run rate of $2.5 billion, and Azure's revenue grew over 150%.
All in all, Microsoft looks well-positioned going forward. The stock doesn’t look too expensive at 14 times forward earnings. A dividend yield of 2.70% makes the deal sweater. Throw in the prospects from the Nokia acquisition, an uptick in the cloud market, and the value proposition of Xbox One, and it becomes clear that Microsoft is a winner.
Stocks Discussed: MSFT, AAPL, GOOG,
Re Here s Why Microsoft Is an Attractive Investment Now
Posted by: WK1900 (IP Logged)
Date: June 16, 2014 05:26PM
MSFT has growth left globally, cash heavy and is positoned to buyout smaller competitors in a variety of areas. MSFT is good for the long term investor.
Stocks Discussed: MSFT, AAPL, GOOG,
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