Microsoft’s Stock Is Boring Yet Tempting

January 25, 2013

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E = Equity to Debt Ratio Is Strong

The debt-to-equity ratio and balance sheet for Microsoft are strong.

	Debt-To-Equity	Cash	Long-Term Debt
MSFT	0.17	$66.64 Billion	$11.95 Billion
AAPL	0.00	$29.13 Billion	$0
GOOG	0.07	$48.09 Billion	$2.99 Billion

T = Technicals on the Stock Chart Are Mixed

Microsoft hasn’t done much during one of the biggest bull markets in history. It almost seems as though the company now lacks motivation to be the best. Microsoft has grossly underperformed Apple Inc. (NASDAQ:AAPL) and Google Inc. (NASDAQ:GOOG) over the past three years.

	1 Month	Year-To-Date	1 Year	3 Year
MSFT	-0.04%	1.27%	-5.20%	0.65%
AAPL	-13.89%	-15.83%	7.49%	128.50%
GOOG	6.13%	6.45%	29.62%	36.91%

At $27.23, Microsoft is trading above its 50-day SMA, and below its 100-day and 200-day SMA.

50-Day SMA	27.02
100-Day SMA	28.43
200-Day SMA	29.33

E = Earnings Have Been Steady

Earnings had been improving since 2009, but 2012 saw a decline. However, revenue increased in 2012 and it has been increasing since 2009.

	2008	2009	2010	2011	2012
Revenue ($)in billions	60.42	58.44	62.48	69.94	73.72
Diluted EPS ($)	1.87	1.62	2.10	2.69	2.00

We already know what happened this quarter. Now let’s take a look at previous quarters.

	9/2011	12/2011	3/2012	6/2012	9/2012
Revenue ($)in billions	17.37	20.88	17.41	18.06	16.01
Diluted EPS ($)	0.68	0.78	0.60	-0.06	0.53

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