Microsoft Corporation (MSFT): Earnings Make it a Strong Buy

Catalysts

Microsoft Corporation (NASDAQ:MSFT) expected the Windows 8 to act as a major catalyst for the PC market, but that has not happened due to a number of reasons. One of the primary reasons has been the inability of current hardware to give the optimal Windows 8 experience. Intel Corporation (NASDAQ:INTC) is ready to remedy some of these issues with its latest Haswell chips. This new hardware can kick-start a major upgrade cycle and greatly benefit Windows sales. According to reports the codename Haswell chips will be 20x more efficient as compared to existing Ivy Bridge structures. Intel Corporation (NASDAQ:INTC) is promising that battery life of as much as 13 hours on Haswell, which is phenomenal by any means.

Conclusion

Microsoft Corporation (NASDAQ:MSFT) jumped 3.4% on earnings as the street responded positively to the unexpected earnings beat. The top line performance should improve further in the next few quarters as the royalties from Windows Phone 8 start to arrive. The improved Lumia sales are another positive sign, and investors should expect sales to further improve in 2H2013. Haswell is the next major catalyst for the entire PC industry and has the ability to stem the slump. At a P/E of 9.9x and yield of 3.1%, the current quarter gives investors only more reasons to invest in Microsoft Corporation (NASDAQ:MSFT).

The article Earnings Make it a Strong Buy originally appeared on Fool.com and is written by Mohsin Saeed.

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