MSFT stock fell 0.66% Wednesday to $35.93. The stock is down nearly 4% year to date.
So what if the market drops a little from time to time? That's inevitable, and in the long term, healthy.
The fact remains we're in a bull market. We have been since March 2009.
But now, especially with some early 2014 swings, investors may be wondering.
How long does this bull have to run and what should we do next?
I don't have a crystal ball... but I do have 30 years' experience - starting in 1982 on the floor of the Chicago Board Options Exchange, then running a big bank's hedge trading, then a Wall Street trading desk, and finally managing my own hedge funds.
I know many investors stick to a buy-and-hold strategy or more actively trade. There's a place for both to maximize this market.
A $7.2 billion deal between the two companies was declared late Monday. Microsoft was additionally in the news in late August when its often-embattled and rarely popular CEO Steve Ballmer announced he will retire in the next 12 months.
What would it take for Money Morning Chief Investment Strategist Keith Fitz-Gerald to buy Microsoft (Nasdaq: MSFT) stock?
The company's shares jumped 7% on Friday on news that often-embattled and rarely popular CEO Steve Ballmer will retire in the next 12 months. News that Ballmer will finallytake a bow was music to Wall Street's ears, apparently, but Fitz-Gerald was singing a different tune.
For too long we've been held hostage by our local cable companies. Their monopoly-like status has left us chained to spotty service, inexplicable rate hikes and laughable customer service.
But a new product is about to trigger a revolution - or, evolution - that could end the cable company reign.
Despite apathy from Wall Street, it has the potential to become a major competitor in markets like smartphones, tablets, and enterprise solutions. Here's the (surprising) fuel for Microsoft's future growth.
Money Morning's experts picked through the list of disappointing names and came up with the five worst CEOs of 2012.
Here are the finalists, along with our experts' reasons why these weak performers should be given the axe in 2013:
- Ben Bernanke, Chairman of the U.S. Federal Reserve - Picked by Chief Investment Strategist Keith Fitz-Gerald:
Bernanke is the CEO of the biggest private institution on the planet, the Fed.
Despite overwhelming evidence that the theories and methods he is using have not worked, are not working and have never worked since the dawn of recorded history, he continues to plow ahead with more of the same failed monetary and fiscal policy that got us into this mess.
In the process, he risks unspeakable damage to the United States and to the global financial system while only kicking the proverbial can down the road.
Microsoft announced Monday night that it would take a $6.2 billion charge this quarter to reflect the destruction of nearly all of the value of the $6.3 billion deal it made in 2007.
The write-down will more than wipe out Microsoft's profit for the June quarter, which analysts had projected to be about $5.25 billion.
The deal was supposed to help Microsoft catch up to Google Inc. (Nasdaq: GOOG) in the race to profit from online search.
However, Google's U.S. share of search remains about 67%, aided by its own $3.2 billion acquisition of DoubleClick the same year Microsoft bought aQuantive.
Microsoft has managed to increase Bing's share to about 15.4%, but most of its gains have come from search partner Yahoo! Inc. (Nasdaq: YHOO).
And Microsoft continues to bleed cash from search, losing $10.4 billion since 2007 and $2 billion in the past year alone.
Google, meanwhile, used its acquisition of DoubleClick to double its profits to $9.7 billion last year.
At the event, Microsoft Corp. (Nasdaq: MSFT) CEO Steve Ballmer unveiled a device with a 10.6-inch widescreen display and a pressure-sensitive cover that also serves as a keyboard. As one would expect, the Surface tablet runs Microsoft's next generation operating system, Windows 8.
Oddly, Ballmer left out several key details, such as the exact date Surface will go on sale and how much it will cost.
What's clear is that Microsoft recognizes it has fallen behind in the mobile market, and that it didn't trust any of its traditional PC-building partners to produce a compelling Windows 8 tablet.
The surprise announcement of the Surface tablet, preceded by an invitation just days before that gave no details, succeeded in generating an Apple-like buzz.
"If imitation is the sincerest form of flattery, the compliments from Microsoft poured down like a torrential storm on Apple last night," analyst Brian White of Topeka Capital Markets wrote in a research note today. "At the same time, this event indicates to us that Microsoft is still searching for its own identity in the post-PC era, something that has come naturally for Apple with the rise of the mobile Internet."
Back in November 2010, when Microsoft Corp. (NASDAQ:MSFT) unveiled its Kinect product to the public.
Kinect is a motion-sensing input device that responds to full body movements - no remote required - as well as gestures and vocal commands.
It made a great add-on to the firm's popular Xbox 360 game unit. Indeed, it turned the gaming world upside down two years ago, immediately expanding the appeal of gaming to dancers, athletes, and even the elderly. (Kinect is a verifiable nursing home hit.)
Yet it soon became clear that it was to become much, much more than that.
The motion-sensing technology behind Kinect is breakthrough high tech. I predict it will have hundreds of applications that could be worth billions to investors.
Musicians could put on live concerts with a virtual "band" backing them up. Kids could learn to mimic the exact movements of their favorite sports stars.
Online shoppers could use a personal avatar that lets them virtually "try on" clothes before buying them. Stroke victims could receive physical therapy through their home PCs or their smart TVs.
With the gesture controls, surgeons could even access patient files, send alerts to other doctors, even pull down facts from the Web if needed - all without leaving the confines of a sterile environment.
As I see it, motion sensors will change the future of gaming, architecture, design, medicine, and much more...
No wonder hackers jumped on board in droves.
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Then it introduced Kinect.
Today, the tech giant is using Kinect to win big on a breakthrough that will literally touch millions of lives.
It is one of the reasons why Microsoft's stock has gained more than 20% this year.
What is Kinect?
You may recognize it as the best-selling add-on to the Xbox 360 video game. But it's much more than that.
It represents a revolution in how we will communicate with our computers, our TVs, and our smartphones.
For Microsoft, Kinect is literally a game changer. They lead the world in the technology behind it and it promises to be big.
But not just for Microsoft...not by a long shot.
The Promise Behind Microsoft KinectThe magic behind Kinect is that it responds to body gestures.
And while Kinect did debut to rave reviews, Microsoft executives really didn't understand how Kinect could change the world -- and rack up new sales.
But since its introduction in 2010, hackers have found dozens of very cool uses for Kinect-- none of which did much for Microsoft's bottom line.
This got the software giant to thinking that maybe they were sitting on a potential gold mine.
That's why Microsoft is now tapping the genius of young entrepreneurs to better monetize the technology behind Kinect.
You know, the type of guys who live and breathe cutting-edge high tech.
In fact, Microsoft recently picked 11 startups to work at its Kinect development offices in suburban Seattle. It's a savvy move.
After all, these guys get out of bed every day looking to create the Next Big Thing.
Already, the program shows great promise. Here are some of the slick high-tech ideas these young turks are already tackling:
The DOJ accused Apple of colluding with several major publishers to fix the prices of electronic books in its iBookstore.
The evidence was strong enough that three of the five book publishers settled before the DOJ filed the suit. Two, Macmillan and the Pearson PLC (NYSE ADR: PSO) Penguin Group, decided to fight the charges along with Apple.
The antitrust case itself poses little threat to Apple. With $100 billion in the bank, it can afford to fight government lawyers until doomsday.
Even losing the case wouldn't make much of a dent in Apple's pocketbook. The three publishers that settled paid a combined $51 million, hardly a concern to a company that earns an average of $120 million every day in profits.
Likewise, a remedy that forces Apple to lower prices for e-books in its iBookstore would have almost no impact on earnings. Nearly all of Apple's profits come from sales of high-margin hardware like the iPhone and iPad. Profits from all iTunes Store segments, which include the far more voluminous sales of apps and music, account for less than 4% of Apple's profits.
And yet this antitrust suit poses the biggest threat Apple has faced in years, as former tech kings Microsoft Corp. (NASDAQ: MSFT) and International Business Machines Corp. (NYSE: IBM) can attest.
"This echoes back to the peak in Microsoft," Sean Udall, author of Minyanville's TechStrat Report, said in a Yahoo! Finance interview. "Microsoft had a monopoly and was doing great and was the star tech stock of yesteryear. And you can almost draw the peak of their stock when they had major DOJ issues."
The problem with being in the DOJ's gunsight is that it distracts management, makes the company hesitant to innovate, and blemishes the company's public image.
While antitrust woes may not have been entirely responsible for Microsoft and IBM ceding their dominant positions in tech, they were clearly a major factor.
And worse for Apple, the e-book case could be just the beginning.
The Leaders to Laggards articles described how each company's failure to anticipate changes in their markets undermined their ability to grow revenue. Consequently, their stocks - which many investors rode to massive profits in the 1990s - have languished for the past decade.
Those tribulations have continued since the publication of our series. Microsoft and Cisco have struggled mightily, and as predicted, only Intel has managed to make headway.
Why Intel Is Still a 'Buy'Intel surprised Wall Street with better-than-expected earnings last week - its standout divisions pointing the way to the future growth that for years had eluded the company.
Profits were up 2%, while revenue jumped 21% year-over-year. And gross margins edged up to 64% from 61% in the previous quarter.
Revenue from data centers, which provide the infrastructure for the cloud-computing trend that is now beginning to dominate mobile devices such as tablets and smartphones, was up 15.2% and accounted for nearly 20% of total sales.
Intel sees data centers as a major source of growth. The company expects sales to rise to $10 billion this year and to $20 billion within five years.
An even bigger surprise was the strength in the chipmaker's PC business, which accounted for 64% of Intel's revenue. Sales of the PC division rose 11% despite sluggish growth of about 2.5% in the overall PC market.
"We knew that there would be strength in the servers, but to see double-digit growth in their PC unit is great," Michael Shinnick, a money managerat Wasatch Advisors Inc.,told Bloomberg News.
However, the phone won't make it out in time for the Christmas season, as many had hoped.
Apple will be ramping up to mass produce the new touchscreen handset by the end of 2010 and release it in the first quarter of 2011, people familiar with the matter told The Wall Street Journal. While the phone would be similar to the iPhone 4 sold by its current carrier, AT&T (NYSE: T), it would be based on an alternative wireless technology used by Verizon, the people said.
The Verizon iPhone will mark the end of AT&T's agreement with Apple that gave the telecommunications giant exclusive rights to market and sell the handset since 2007, when Apple Chief Executive Steve Jobs introduced the original iPhone.
Verizon has been testing its networks and capacity to handle the heavy data load by iPhone users, seeking to avoid the kind of bad publicity that plagued AT&T after booming sales of data-hungry iPhones crippled its network.
Microsoft is one of the safest investments in the world, but the software giant's stock price has done essentially nothing for the last 10 years. But the company is still a monopoly, has no debt, and continues to generate a torrent of cash.
In fact, Microsoft now has one of the largest cash hordes in the history of capitalism - more than $44 billion, and growing.
So what's different? What's the catalyst that promises to break this giant out of its somnambular state, to make its shares a "Buy?"