Microsoft Corporation Earnings 1QFY16

The software giant has reported mixed earnings for the first quarter of 2016 and analysts expect it to grow further in the year

Microsoft Corporation was recently seen releasing its earnings for the first quarter of the new fiscal year right after which the analysts in the industry turned out to have all kinds of different opinions on how the giant could make sales in the future. One of such analysts is from equity firm Argus Research, and they have decided to present the software company with a ‘hold’ rating, which has just been reiterated by the firm. Previously the take of the analysts of the firm was almost the same and the investors and shareholders were advised to keep their shares on the hold for the time period.

Following the earnings release, it looks like the Microsoft’s software business has huge aims to attain but might not be able to do in the last quarter at least. The sales of its cloud computing services which includes Office 365 along with the OEM software were much lower than the figures that were actually expected out of the giant by the analysts in the market.

However, on the other side of the picture, the tech company has gone up on the revenue department in which it has reported non-GAAP earnings per share of around $0.67 which actually turned out to be beat estimations which were made at a figure of $0.58. As for the earnings that were reported in totality, the giant managed to report a revenue of $21.6 billion, which was very close to the actual estimation of $21 billion which was made by the analysts.

Analysts at Argus are of the opinion that these earnings show a positive end for the Microsoft business and it looks like the new financial year is going to be a challenge for Satya Nadella, the CEO of the company, as he is expected to experience some important product releases during his tenure which could either turn out to be a success or a struggle for the giant.

The consensus estimations made for the Microsoft stock show that around 23 equity giants have presented the company with a ‘buy’ rating whereas around 13 firms believe the stock deserves a ‘hold’ rating.

Apple Gets Upgraded By Goldman Sachs

The software giant has been upgraded by analysts at Goldman supported by success of its ecosystem

Apple stock has recently been upgraded by analysts at Goldman Sachs, who have come to realize that despite the ups and downs that the company has lately been facing, it actually does have a lot to offer to the investors for the near term future. The stock of the iPhone making company has been looked at by the analysts in the industry with a lot of speculations, and some have remained bullish about the company while some believe that the falling iPad and Mac sales might sooner or later take a toll on the share price of the company.

Apple’s stock price has been experiencing massive fluctuations on the index lately which has reportedly made the investors of the software giant quite concerned over the period of time. The bullish remarks of analysts have not helped the investors either and they have still remained confused about what to take of the high volatility of the stock lately. However, times may have changed now as analysts at Goldmna Sachs turn highly positive about the stock of the iPad creators with not only a ‘buy’ rating, but also a target on the share price of $163. This clearly suggests that the analysts have finally come to see a side of the company that could raise hopes of the investors in the long run.

According to reports, it seems like the Goldman analysts are looking at the success of the ecosystem that Apple business rolled out some time back and believe that this venture has the potential to grow even further for the company. On the other hand, the same analysts have also suggested that the iPhone makers should also bring its other products to use and start focusing monetization on them as well, apart from the revenue generation it is making from the sales of its smart phone.

Analysts in the industry, moreover, are of the opinion that the software company is in a good position to grow in the Internet of Things platform with its newly upgraded ecosystem. Not only that, the giant also has the capability to carry out a massive generation of revenue through the ecosystem, and bring back cash into the stock of the company in colossal figures.   It is believed by the analysts that the Californian company needs to think more about software than hardware at the moment, as it is very likely that the giant turns out like Blackberry in the future and starts failing in the hardware department as its products become more and more reductant with the passage of time. 

Apple Inc. Stock Update

The iPhone making company is not expected to experience a massive growth in the total revenue generated for the full year, as compared to the previous year

Apple Inc and the strongest tech giant of all times, Alphabet have been compared on a lot of different platforms by the analysts of the industry. In a recent article published by the Motley Fool, it was seen that the software giant has proved itself in the course of the past decade that has made it good enough to be compared by the search engine giant on different levels. For the investors to know, the analysts have presented an analysis in which they have discussed the potentials both the companies have in the stock market and which one of the stocks the investors can opt for in the long term.

Even though Apple stock has been performing well as compared to the other tech companies in the industry, it has lately been failing to secure a stronger rating from the equity firms. Analysts are of the opinion that the stock seems to be at a much cheaper level if it gets compared to that of Alphabet. Currently, the price to earnings ratio that the iPhone makers are trading on is 13 whereas the average companies on the index are seen securing a higher than 19 ratio on a normal basis. This is something that is making the analysts believe that the giant could be getting undervalued in the market at some point.

On the other hand, Apple business did manage to amuse the investors by performing quite well in the last reported quarter of the year, in which it announced a growth rate of 22% for the sales of its products alone and the revenue turned out to be at $51.5 billion. As for the earnings that were made by the Mac producers per share, an increment was observed by 38% as compared to the same quarter of the previous year which is a jaw dropping rate for the EPS to grow.

However, things might not be as great for the giant by the end of the year, as the Wall Street Analysts are of the opinion that Apple products might only experience a growth of 3.6% in December not more than that, which is mainly due to the fact that the iPhone business has matured to a level on which sales are to decrease naturally. The expected revenue for the company for the full year of 2015 is to be reported in between figures of $75.5-77.5 billion as per the guidance made by the management. And this shows that the giant is not expected a lot of growth this year, as in the previous year it reported revenue of $74.6 billion.