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Google Trends Suggest Microsoft’S (MSFT) Windows 8 and Stock Price are Discounted

 November 01, 2012 01:50 PM

(By Rich Bieglmeier) With Windows 8 available everywhere from Amazon (AMZN) to Wal-Mart (WMT), iStock made another keystroke trip to Google (GOOG) Trends to get a sense of how popular the new operating system might become.

We used the keywords Windows 8, Windows 7, Windows Vista, and would have included Windows XP, but the data only goes back to 2001, and XP was released in 2001.

In order to understand the buzz on the web, we need to see how Windows 8 stacks up to its ancestors. Microsoft's (MSFT) stock should be doing a litter better if web searches are an indication of consumer interest.

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Windows Vista was released January 30, 2007, and garnered the most queries around the launch date. Back then, MSFT shares rallied into the launch, fell following the release date, and bottomed in the middle of March. By mid-May, MSFT's stock price returned to its pre-Vista launch high. From there, shareholders endured a series of sputters and starts before Microsoft finally blasted through the Vista top in late October, nine months later.

As for searches, Windows 8 is currently running at roughly 75 percent of Vista at similar points in the launch cycle. However, unlike 2007, MSFT shares faltered prior to October 26th's official release for 8.

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While 8 trailed the online buzz of Vista, interest is running at the same level as Windows 7 during its July, 2009 release. In fact, the current version's trend-line is accelerating at a faster pace than its predecessor.  Although Vista had the strongest initial search volume, Windows 7 is the trendsetter, with 7's peak search volume more than doubling Vista's peak.

Much like Vista, MSFT's stock price advanced prior to 7's launch and dipped briefly afterwards; however, the stock price and search volume accelerated following slight pauses. In the six months after the July 22, 2009 release, the software giant's stock price gained more than 30 percent and online queries doubled.

Windows 8's search trend-line looks more like Windows 7 than Vista's trend-line. With that in mind, iStock believes Wall Street might be discounting Windows 8 impact on the company's share price. If our Google Trends interpretation is correct, then Windows 8 search volume and stock price should be much higher in the next six months than they are today.


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