kowenicki said:
Stock up 45% in the last 12 months increasing the market cap by about $100 billion.
Surges 4% today on the back of Office for iPad (estimated $2bn revenue stream) and other mobile initiatives such as expectations of android apps on Windows phone and windows apps on other mobile OS.
Microsoft stock up 4%, hits 14-year high
By David Goldman @DavidGoldmanCNN March 18, 2014: 2:43 PM ET
Microsoft has finally put the worst of the dot-com bust behind it. Shares surged more than 4% Tuesday to their highest price since March 24, 2000.
The stock rose after Microsoft (MSFT, Fortune 500) disclosed plans for a press conference about a new product for mobile and cloud computing to take place on March 27. Microsoft is widely expected to unveil Office for the iPad -- a release that many analysts believe is long overdue. New CEO Satya Nadella will be making the announcement.
Microsoft's stock has mostly oscillated between $20 and $40 over the past decade and a half, a frustrating period for investors who called on the company to innovate beyond software for the PC.
Under CEO Steve Ballmer, Microsoft largely missed the boat on major tech trends of the past decade, including smartphones, tablets, search and portable music. Meanwhile, Google (GOOG, Fortune 500) and Apple (AAPL, Fortune 500) both surpassed the company in market value.
Related: Microsoft launches cheaper Office 365 'Personal'
Shares have been on a tear since August, when Ballmer announced his retirement. Longtime Microsoft executive Nadella took over for Ballmer last month.
Microsoft has performed well as it transitions into a devices and services company. Microsoft has found success with its Xbox One video game console and Kinect attachment. Sales of its Surface tablet and Windows Phone devices are growing -- albeit from a very small base.
The company also announced plans last year to buy the smartphone business of Nokia (NOK), further solidifying its new role as a hardware maker.
Microsoft's software for businesses has also been a major driver of its recent success. Nadella had led Microsoft's corporate software unit before being named as CEO.
Microsoft shares hit 14-year high on Office-iPad news
by Todd Bishop on 3/18/2014 at 1:35 pm |
New Microsoft CEO Satya Nadella. Photo courtesy of Microsoft.
Microsoft shares closed at $39.55 today, up nearly 4 percent — reaching their highest point in 14 years following reports that the company will unveil a version of the Office suite for Apple’s iPad next week as part a broader strategy shift under new CEO Satya Nadella.
Here’s the question: Will the move to further embrace platforms that compete with Windows be good for Microsoft’s business overall?
The new Office for iPad could boost Microsoft Office 365 subscriptions, which would be required to use the apps, contributing to Microsoft’s revenue. But in a note to clients this morning, Nomura analyst Rick Sherlund said the change could reduce the demand for Software Assurance, the volume licensing deals that Microsoft strikes with large businesses.
However, investors seem to be more interested in the long-term potential of the strategy.
Sherlund writes, “The upcoming announcement will likely be more beneficial to the stock than to earnings if much of the incremental demand comes at the expense of Software Assurance, but investors are likely to welcome the directional shift in the business to non-PC and non-Windows platforms and a stated direction which we would expect to emphasize a mobile and cloud first strategy.”
Steve Ballmer must be scratching his head over this one. Microsoft’s share price is now higher than it was for the bulk of Ballmer’s tenure as CEO. The irony is that Microsoft actually signaled its intent to release Office for iPad while Ballmer was still CEO, albeit somewhat vaguely. Microsoft’s leadership change, and the fact that the unveiling is now imminent, has apparently grabbed the attention of the market.
At least Ballmer still benefits from his position as a major Microsoft shareholder.
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