MSFT Up Modestly As Markets Rally Stocks got crushed yesterday in the 6th biggest point loss for the Dow ever, but are recovering today as major indexes are trading solidly in the positive. Shares of MSFT are up modestly near the flatline, while the tech sector is rebounding with over a 3% gain. Upcoming catalysts include the company's Analyst Day at its new developer conference (BUILD) on September 14;
Windows Phone 7 / Mango rollout and adoption with hardware partner
Nokia; strides against current market leaders in cloud computing; any entrance in the tablet market; making money in the online business, including integration of
Skype and improving the search / display business; and continued evolution of
Kinect and next generation
Xbox console. The stock currently trades at
6.9x Enterprise Value / TTM Free Cash Flow.
Microsoft Has A Higher Credit Rating Than The Country In Which It Does Business (CNNMoney) There are currently
four U.S. companies that have a better credit rating than their own country, and Microsoft is one of them. ADP,
Exxon,
Johnson & Johnson and Microsoft and were all reaffirmed their AAA ratings yesterday. According to Standard & Poor's, "given the global and diverse business lines and significant financial strength" of the companies, "we expect the borrower to continue to fulfill its financial obligations, even in a sovereign default scenario." Additionally, they are all non-financial firms which insulates them from the impact of the U.S. downgrade. However, this didn't help the stocks yesterday.
Read » Whitney Tilson Still Pounding The Table On Microsoft (Seeking Alpha) Whitney Tilson is known to be a very modest value investor but he is highly recognized for his contribution in the field of value investment and behavioral finance. Among his top picks? Microsoft. The stock has returned 1.8% since the end of first quarter (minus yesterday's correction) and Tilson has since increased his Microsoft call options by 451% and Microsoft stocks by 44%. I'd be bullish too if I was long that much.
Read » Microsoft Emerges A Solid Value Play As Markets Tank (Seeking Alpha) With the market down 11%+ over the past two weeks due to debt ceiling worries, further financial crisis in Europe, and disappointing economic indicators, several strong value plays have emerged. Microsoft currently pays a quarterly dividend (2.49% yield), has repurchased 1.7 billion net shares over the past 5 years (16.8% reduction), has net cash of $40.85 billion and has grown EPS at a 9-year annualized rate of 21.1% (5-year annualized at 17.5%).
Read » Microsoft Can't Afford To Shed Bing (GigaOM) Analyst David Card, says "Microsoft must have a credible search-engine business to defend its core platforms and APIs, as well as keep its biggest rival,
Google, honest by forcing Google to create sustainable business models in competitive markets." In other words, without
Bing, Microsoft lacks the firepower to counter Google online. And there really are no other formidable challengers. Just ask
Yahoo!
Read » Another One Bites The Dust, Microsoft Loses Windows Phone General Manager (Various via techDygest) Microsoft's General Manager of the
Windows Phone Developer Experience and Partner Group,
Charlie Kindel, announced that he is leaving Microsoft to launch a startup. He is leaving Microsoft after 21 years with the company. Charlie previously ran the Windows Home Server project before turning his attention to
Windows Phone 7. The startup will focus on a mix of ads, cloud, mobile and athletics.
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