Stock of the day 23/01/2015 – Microsoft Corp

Microsoft remains in the top three most valuable brands in the world, behind Apple and ahead of Google, and will be first out of the blocks on Monday to announce its Q2 2015 earnings release before fourth quarter reveals from the aforementioned giants later in the week.

2014 was another year of steady gains for the tech-giant, much like 2013, with the company starting at a price of $37.37. In what was to be a positive sign for the company, its 2014 low came very quickly in the year at $34.64 in mid-January. From that point onwards Microsoft saw a consistent year of gains, with only the market wide drop in mid-October interrupting this run. By mid-November the company was trading at $49.58, and started 2015 not much lower at $46.45. Since then Microsoft has maintained this level, and is currently trading at $47.11.



CEO Satya Nadella’s strategies have been welcomed by the markets, with focus on web services over its Windows software. However, with the upcoming launch of Windows 10, it will be the successes and/or failures of this latest update that dominates much of its 2015. In a savvy marketing move, Microsoft is intending to give away its latest operating software to those customers that are already using the most recent version of Windows. Microsoft has claimed that Windows 10 is built for a world with an every-increasing about of devices, and the company is hoping to get the jump on Apple and Google who are working on similar software.

However, Microsoft is still struggling with its Windows phones and tablets, as these devices continue to suffer in comparison to the dominant Google Android phones and the omnipresent iPhone. This has not stopped Microsoft from experimenting with new hardware, and the company recently revealed its ‘HoloLens’, a pair of wearable 3D glasses that appear to be a souped- up version of Google Glass. With the latter struggling to take off in any meaningful way, the value and marketability and such products remains to be seen. Regardless, Microsoft, under the tenure of Nadella, is still committed to exploring the boundaries of new technology.

Last quarter saw a 25.2% year on year revenue rise, with this release in October leading the charge towards the company’s 2014 share price highs. Out of the analysts polled, 13 are a buy, with 11 at hold and 3 at sell, with expectations of a 7.4% in revenue to $26.32 billion, and estimated earnings per share of $0.71. If Microsoft can meet these forecasts the company will be on the right path for its 2015 to match the strong performance of the past 2 years.