The Upshot: Goldman's Sherlund Keeps Microsoft Ax Sharp

Since influential Goldman Sachs analyst Rick Sherlund issued a negative report last Thursday on Microsoft (MSFT Quote), reducing his revenue and earnings projections for the company's March quarter, the stock has been rising like a helium balloon.

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It's enough to make even the most optimistic investor wonder whether Sherlund, regarded by the Street as the ax on Microsoft, was losing his edge. He has enjoyed a close relationship with the company since Goldman underwrote its IPO in 1986, and his reports have carried enough punch to move even a heavyweight such as Microsoft.

But rather than a loss of pull, the issues raised in Sherlund's report and the way investors reacted to them may suggest a fundamental shift in investors' attitudes about Microsoft. ...