After following this company for 18 years, I can say that I’m pleased with the company recent changes. Window 10 is going according to plan. The new Office 365 suite plan offerings are promising. The new Surface Pro 4 is a surprise. However, what really got me excited on this company and stock is the Azure cloud services. Furthermore, give credit to the new CEO Satya Nadella for improving Microsoft culture and relationship with other companies. Here are some points for why I’m bullish on this company, MSFT.
Window 10 is receiving great fanfare and adaption. However, it’s becoming more of a commodity going forward for Microsoft. Hence, I don’t believe to Window will add much to the company future earning. Nonetheless, it will give the company more leverage and retaining the huge customer based such as Android on smartphone and Apple OS. This will give Microsoft more leverage to its other products offering.
The Office 365 online plan adaption is great as it compete with Google Doc. As more and more company go online for Office 365, Microsoft profit margin will steadily increase. With the streaming income from the online service Office 365, it will be Microsoft new online cash cow.
The Surface Pro 4 is a great product. I don’t expect it to add much to Microsoft bottom line because of cost. However, as more people get excited about this product, the company can compete with Apple high-end client and retaining as well as reclaiming customers back to Microsoft. With this being said, the company can offer more products according to the company vision. This bring me to the Azure.
The online cloud service for business Azure. OneDrive is great for personal use. But Azure is a different class in itself. Azure was created to compete with Amazon cloud services. In following Azure offering for over 2 years, I can say that Azure is ready to compete with Amazon for high-end clients. This is evidence from the recent earning report. I believe going forward, Azure will greatly add value to Microsoft bottom line.
Even with the recent surge after earning report, I believe Microsoft has more room to go as the company is becoming a growth company, again. The sleeping giant is awaken.
Disclosure. I currently don’t own this stock. However, I may consider adding to our portfolio in the near future.