Microsoft Cut at CSFB

CSFB cut its investment rating on Microsoft(MSFT Quote) to neutral from outperform, saying there are better places for software investors to put their money.

The stock closed Thursday at $26.99, which is 20.4 times the 2006 Thomson First Call consensus earnings estimate of $1.32 a share and 17.8 times the 2007 estimate of $1.52 a share. Microsoft's fiscal year ends in June.

"With the stock trading near $27, and having only 10% appreciation to our [$29] price target, we believe that the stock is only modestly undervalued," CSFB wrote. "Microsoft could still serve as a nice hedge against near-term volatility in the market, however we find other software stocks as offering greater long-term growth potential." ...