top of page
Search

Microsoft-Be what’s next

  • Writer: Harsh Mittal
    Harsh Mittal
  • Jan 10, 2022
  • 3 min read

Microsoft is an American multinational technology corporation that produces computer software, consumer electronics, personal computers and related services.Microsoft was founded by Bill Gates and Paul Allen on 4th April 1975 out of Albuquerque,USA.Their founding can be traced back to the development of software for the Altair 8800 made by Xerox which was considered the first personal computer.Following this, Bill Gates started to develop software and even personal computers for use of the masses.After development of the software for basic computation functions, they moved on to develop software to perform particular tasks such as word processing.Microsoft went public on March 13, 1986 with 2.5M shares at a price of 21$.Rather interesting is the fact that they closed their first day of trading at 27.75$.


Microsoft is currently trading at 310-315$ with a market cap of 2.35T $.Their success is owed to their software services particularly their personal computing software Windows.The personal computing market is an oligopoly and most users tend to prefer the Windows processing system rather than the MacOs counterpart.They also provide other software such as Word, Excel, Powerpoint which are called Office Applications which are again majorly used creating a recurrent revenue stream for Microsoft.


Microsoft has a median price forecast of 370$ with a high prediction of 440$ and a low prediction of 294$.The median forecast represents a 18% increase from the last traded price.This shows steady returns and recovery towards the all time high showing positive signs of growth.Microsoft generally rises steadily and does not have gain and consolidation phases as such but over the last few years has seen more radical price changes.With new products such as the Windows 11 and the Xbox Series X hitting the market, the company is expected to have a massive boom in sales.


Microsoft is one of the most reputed and sought after companies by long term investors as it is a blue chip company which steadily rises but still outperforms the NASDAQ and other comparable metrics.Their stability is always seen as risk mitigation and is therefore a part of most long term portfolios and is also almost always bundled in ETFs.Their stability is a result of their recurrent revenue models of services such as Word and Excel.These services are free on windows devices but the updated versions are extremely expensive bringing in a good revenue model for Microsoft. They have been trying to expand their consumer electronics lineup using the Surface laptop which is used extensively by artists and architects for its simplistic design packed with hardcore performance and unquestioned reliability.Marketing strategies such as premium versions of Office365 applications for lifetime have also boosted sales heavily for their personal computers but may prove inefficient in their long term strategy.The over dependency on Windows is a contributing factor for Microsofts growth which does not seem to be changing anytime soon. Microsoft has also been extremely active in diversification which is seen with the launch of their gaming console the XBOX, their social media application LinkedIn and their code development application GitHub. Linkedin is seen as a staple social media app for professionals and corporations most of whom tend to purchase a premium subscription allowing access to a large number of features thereby increasing revenue for Microsoft.The. gaming industry also brings a whole lot of revenue to Microsoft through the Xbox studios and subscriptions related to the same. As Work From Home culture expands and education moves online, Skype communications is also increasing in popularity.Taking future trends into consideration, Microsoft had acquired Altspace VR to develop augmented reality tech to compete and complement the likes of Meta which might pay off in the future.Microsoft has also been known to have fair compensating structures towards legal issues, staff and investors as well which makes them fundamentally strong.By fulfilling the goals of all the various stakeholders, Microsoft is growing steadily.



 
 
 

Comments


Drop Me a Line, Let Me Know What You Think

Thanks for submitting!

© OPUS BLOGS BY HARSH MITTAL 2021

bottom of page