Microsoft Is the Real Technology King
NEW YORK (TheStreet) -- It's astonishing how often I receive perplexed looks on people's faces when I respond that Microsoft (MSFT) is the hot tech stock to own.
It happens so often that I now anticipate and expect it. I think that's exactly why Microsoft remains a stock you want in your portfolio.
We've all heard the arguments against Microsoft. Apple (AAPL) tablets are displacing desktops, Google (GOOG) apps are destroying Microsoft Office's margins, piracy in China and other countries retard growth, and on and on.
The problem for the bears is the numbers don't support their thesis. Revenue is at all-time highs, net income is trending near the record of 2011 and Satya Nadella, the new CEO, is the right person to lead the company.Prior to ascending to the helm, Nadella led Microsoft's Cloud and Enterprise group. According to Synergy Research Group, Microsoft's year-over-year cloud growth rate is 154%. That compares to number one-ranked Amazon's (AMZN) 67% growth rate. Anyone who claims Microsoft is no longer a growth company isn't paying attention.
Microsoft has its work cut out to catch Amazon's estimated 30% market share, albeit Microsoft has the ability to steal as much market share from Amazon as it wants. Amazon is in the midst of shareholder pushback resulting from a lack of relative profits. Microsoft can easily and should be expected to squeeze Amazon's cloud margins.