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Buy Intel, Microsoft as They Prepare Assault on Apple

Stocks in this article: INTC MSFT AAPL NOK BKS

NEW YORK ( TheStreet) -- Intel (INTC) and Microsoft (MSFT) have been the sleeping dogs of the stock market. In a world where we measure everybody else against Apple (AAPL), recent results are telling.

In 2011, AAPL returned over 25%. INTC increased by just over 15% and MSFT dropped by more than 5%. While AAPL still reigns supreme, the tide has begun to turn. As of Monday's close, AAPL is up 42% YTD, compared to 20% and 16% pops for MSFT and INTC, respectively.

Over the last month, both MSFT and INTC have outperformed AAPL. AAPL has struggled to retest the highs it set prior to earnings in early April. While this does not spell impending doom for Apple, consider it a harbinger of things to come over the long term.

Intel and Microsoft are -- finally -- doing all the right things. If anyone was ever going to wake up and provide Apple with legitimate competition, it was these two sleeping dogs. And their push should help weaker companies such as a whole slew of PC makers, Nokia (NOK) and Barnes & Noble (BKS), not only stay alive, but turn things around.

To drive this point home, consider hockey's sleeping dog, and the results of him getting some ice time. If you follow the NHL Playoffs at all, you likely know that Alex Ovechkin scored the game winner Monday night in Washington's victory over the New York Rangers.

For a whole host of reasons, Ovechkin is not getting much ice time. In fact, in last night's game, he only played 13 minutes, 36 seconds. Capitals coach Dale Hunter has a whole host of good reasons for limiting his use of Ovechkin and fellow high-flyer Alexander Semin.

Those explanations aside, Hunter turned the Russian superstar into a sleeping dog. And you know what happens when you wake sleeping dogs -- they make the most of every single shift and, more often than not, do serious damage.

Intel and Microsoft are ready for a little ice time. Let's think about the billions Intel and Microsoft have spent over the last year:

  • Microsoft buys Skype.
  • Intel invests $300 million to push ultrabooks.
  • Intel invests in automotive technology.
  • Intel looks to move into the content game.
  • Microsoft invests billions in Nokia as well as Barnes and Noble's eBook/Reader business.

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