NEW YORK ( TheStreet) -- After reporting stellar quarterly results, Apple ( AAPL) and Microsoft ( MSFT) remain attractive stocks.
Below we'll review three exchange-traded funds (ETFs) that provide exposure to both of these important technology companies. In the fiscal third quarter, innovation king Apple, boasted revenues of $15.7 billion, up more than 61% from a year ago, yielding profits of $3.51 per share. These results smoked Wall Street's revenue expectations by nearly $1 billion and painted a rosy picture for the second-largest U.S. listed stock by market cap. One reason Apple is likely to continue to shine is that demand for the iPhone 4 remains insatiable despite reports of reception problems. Additionally, the Cupertino, Calif.-based technology firm recently updated its all-in-one iMac desktop computer line with new chips from Intel ( INTC) and better graphics. This is expected to further boost appeal of iMacs. In the most recent quarter, Apple sold 1 million desktop Mac units, an increase of 18% from the prior year, generating nearly $1.3 billion in revenue. Currently, it is estimated that Apple is the fourth largest computer vendor in the U.S. with nearly 8.8% of the market share. A third reason Apple is expected to continue to shine is its decision to take an aggressive approach to pricing its iPhone 4 and smash hit iPad. The company expects this approach to reduce margins for these products but make up for that with increased volume. Additionally, Apple remains relatively cheap and is sitting on an enormous pile of cash. Using current forecasts, the stock is trading at a forward price-to-earnings ratio of close to 15 and is hoarding $45.8 billion in cash and long-term investments. Lastly, in the third-quarter press release, Steve Jobs reassured the public that Apple has "amazing products still to come this year." This means that upgrades to current products or strategic alliances with other companies will further boost consumer demand for the company's products.
Microsoft ( MSFT) seems to be singing a similar song. In its most recent quarterly earnings reports, the technology giant boasted revenues of $16.04 billion, a 22% year-over-year gain and nearly $750 million higher than Wall Street's expectations. To add icing to the cake, every one of the Redmond Wash.-based company's businesses witnessed double-digit revenue growth. The Windows division grew a whopping 43.5%, primarily driven by the huge success of Windows 7. Additionally, Microsoft's search engine, Bing, continues to gobble up market share as it witnessed a 19% increase in online advertising revenue in the last quarter.