logo
  Join        Login             Stock Quote

Microsoft Corporation (MSFT): The Long-Term Approach

 June 18, 2013 10:43 AM
 


by Ingrid Hendershot, editor Hendershot Investment

Founded 38 years ago, Microsoft (MSFT) helped launch the first great wave of an information technology transformation; it remains the world's largest software developer with sales topping $73 billion in fiscal 2012.

Throughout its history, Microsoft has achieved success by taking a long-term approach to technology investments. In fiscal 2012, Microsoft invested $9.8 billion or 13% of revenues on research and development with much of that devoted to cloud technologies.

Cloud computing links the computing devices people have at hand to the processing and storage capacity of massive datacenters. Microsoft's solutions will bring the benefits of the cloud to the billion people who use computing today and the billions more who will gain access to digital technology for the first time in the years ahead.

[Related -Microsoft Corporation (MSFT) Earnings Preview: What To Watch In Q2 Results?]

Microsoft believes the impact of cloud computing will be as big, if not bigger, than the previous waves of technology change.

Microsoft's research is paying off as people increasingly choose Microsoft cloud services including Office 365, Windows Azure, Xbox LIVE and Skype. Microsoft recently unveiled Xbox One, an all-in-one gaming and entertainment system..

Microsoft reported excellent fiscal third quarter results with revenue increasing 18% to a record $20.5 billion, generating a 19% increase in net income to $6.1 billion. Growth across all business segments led to this high double-digit growth.

[Related -Microsoft Corporation (MSFT): Good Buy or Good-Bye?]

Microsoft generates exceptional cash flows with the company's trailing 12-month free cash flow topping $27.5 billion, representing a nearly 10% free cash flow yield based on the company's current market capitalization.

Year-to-date, Microsoft has returned $9.8 billion to shareholders through stock buybacks of $4.3 billion and dividends of $5.5 billion, an 18% increase over last year. The dividend currently yields a solid 2.6%.

Microsoft's strong balance sheet boasts more than $74 billion in cash, which provides the company with the financial flexibility to continue to handsomely reward shareholders while investing in future growth.

Microsoft is a high-quality market leader generating exceptional cash flows with substantial cash returned to investors through growing dividends and share buybacks. Buy.

iOnTheMarket Premium
Advertisement

Advertisement


Post Comment -- Login is required to post message
Name:  
Alert for new comments:
Your email:
Your Website:
Title:
Comments:
 

rss feed

Latest Stories

article imageDelta Air Lines (DAL): Panic Selling Makes This Airline Stock Ripe For A Quick Pop

If there ever were a teaching moment in the stock market, it was this week. Earnings, trendlines and read on...

article imageInvesting In The Time Of Ebola

Volatility is back in the market. Whether we are being tossed and turned by the Ebola crisis, Russian read on...

article imageMarket Volatility Continues But Is Bottom In?

The market’s volatility continues, and it has the outlook and expectations of the financial media jumping read on...

article imageBrazil's Petrobras Attracts Bullish Options Play

Brazilian stocks advanced with ADR shares in state-owned oil company Petroleo Brasileiro SA (Ticker: PBR) read on...

Advertisement
Popular Articles

Advertisement
Daily Sector Scan
Partner Center



Fundamental data is provided by Zacks Investment Research, and Commentary, news and Press Releases provided by YellowBrix and Quotemedia.
All information provided "as is" for informational purposes only, not intended for trading purposes or advice. iStockAnalyst.com is not an investment adviser and does not provide, endorse or review any information or data contained herein.
The blog articles are opinions by respective blogger. By using this site you are agreeing to terms and conditions posted on respective bloggers' website.
The postings/comments on the site may or may not be from reliable sources. Neither iStockAnalyst nor any of its independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. You are solely responsible for the investment decisions made by you and the consequences resulting therefrom. By accessing the iStockAnalyst.com site, you agree not to redistribute the information found therein.
The sector scan is based on 15-30 minutes delayed data. The Pattern scan is based on EOD data.