theprof00 said:
Good I'm glad you stand by your statement. It just makes it all the more easy to knock you off of it. Stocks are about growth. 5B$ a quarter to a company who's assets totals well over 200 Billion $ means that it will take Microsoft over 10 years @ this current level of income to double in size. While this is no small feat, businesses who's stocks triple and quadruple over 5 years, are ones that double in size every year. Naturally, the larger the company gets, the harder it is to double, this results in very slowly and sometimes, dipping, stock prices. The reason the article refers to the lost decade is because in this time, apple stocks have done just that. What it goes to show is that in the future, microsoft WONT be making the amount on a course of 10 years because it isn't growing, whereas competition is, and at a certain point, competitive growth will become loss in profit for MS. It's not doom and gloom though, so rest assured about that. A company that is in trouble will do what it must. So, again, 5B is nothing to MS, which is why the stock is level. 5B though, is a lot to Vgchartz, therefore vgchartz stock will flip 12 times over and split 15 times. And everyone who put in a dollar will make 12 dollars,and people who invested in MS will make 12 cents. But just goes to show how much people know before they make criticisms. |
Ok, I understand a lot of what you're saying here. But your analysis is a lot more objective than the original story. For instance, this statement:
"Add it all up and you get a great company in a horrible situation. Google is finally succeeding in championing free operating systems, with Apple cleaning up on the other end. Barring something miraculous, Microsoft's relevance will continue to fade with every passing year."
Those sweeping generalizations about the performance of Google and Apple fail to consider the same principles that you pointed out above. Google and Apple had tremendous growth during the 2000's, just as MS did in the 90's. But what is the likelihood they will sustain such growth throughout the 2010's?
Google is starting to see decline's in search revenue due to competition and Android is not currently a credible source of revenue despite its large install base. Their purchase of Motorola Mobility has been questionable as well, not to mention serious pending litigation from Oracle. Apple without Steve Job's performing in his previous capacity is another question mark as well as the future prospects of the iPhone and iPad in their increasingly competitive markets. Seriously, how much CAN each of those companies grow beyond where they currently are?
MS is healthy, but they will NEVER have the type of crazy growth like what we've saw in the 90's. Every market has it's threshold. Looking at it from an investor's pov, I can understand not putting a ton of stock in MS as a financial goldmine. But to confuse that with a company's financial viability or market strength is not particularly accurate, and this was the tenor of the original article.
