Should You Buy Microsoft Corporation (MSFT)?

Intel Corporation (NASDAQ:INTC) has had a rough past few quarters, serving to fuel the fire that the PC is in dire shape. However, despite disappointing full-year results, in which fiscal 2012 revenue and earnings per share dropped 1.2% and 11%, respectively, Intel Corporation (NASDAQ:INTC) trades for just 13 times earnings and yields 3.6% at recent prices.

Cisco Systems, Inc. (NASDAQ:CSCO)’s third-quarter net sales increased 5% year over year and GAAP earnings per share increased an impressive 15% versus the same period in 2012. The company is firing on all cylinders right now, and after boosting its shareholder payout by 75% late last year, provides investors a 2.7% dividend yield.

The Foolish bottom line

Microsoft Corporation (NASDAQ:MSFT) brings up strong opinions from those who are either bullish or bearish on shares of the world’s software king. There are certainly reasonable arguments on both sides: bulls point to the company’s compelling valuation and strong dividend, while bears pound the table that the personal computer is dead, and so is Microsoft.

While I don’t believe the company should be considered a high-growth stock anymore, investors could certainly do worse than a highly profitable, high-dividend stock with a fortress balance sheet. To that end, going forward I see Microsoft returns likely to resemble the returns previously associated with traditional dividend plays like consumer staples stocks.

Microsoft Corporation (NASDAQ:MSFT)’s earnings growth isn’t likely to set your hair on fire. At the same time, share owners will continue to receive a competitive dividend with double-digit dividend increases every year, along with the margin of safety of a well-capitalized balance sheet. Microsoft isn’t expensive, but I’d like to see a bit of a pullback after such a strong rally to begin the year. If Microsoft falls under $30 per share, it would be very hard to resist.

Robert Ciura owns shares of Intel. The Motley Fool recommends Cisco Systems, Inc. (NASDAQ:CSCO) and Intel. The Motley Fool owns shares of Intel Corporation (NASDAQ:INTC) and Microsoft Corporation (NASDAQ:MSFT).

The article Should You Buy Microsoft? originally appeared on Fool.com.

Robert is a member of The Motley Fool Blog Network — entries represent the personal opinion of the blogger and are not formally edited.

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