Microsoft: It's All About Windows 8

NEW YORK ( TheStreet) -- Microsoft ( MSFT) is scheduled to report fourth-quarter earnings after the bell Thursday, but investors are focused on what's to come, namely Windows 8.

The Redmond, Wash.-based software giant recently announced that Windows 8 would be available in late October, just in time for the holiday season. Microsoft also announced that Office 2013 would be available later this year as well.

Recent PC trends have pointed to sluggish growth, with research firms Gartner and IDC pointing to flat year-over-year growth. Intel ( INTC) mentioned slowing growth in the back end of 2012 in its recent earnings report, confirming this theory.

Even with flat growth, it's all about Windows 8. "Overall, we continue to expect the stock to be driven by the potential growth prospects of the upcoming Windows 8 release (specifically its ARM-based version entering the tablet market) rather than actual quarterly results," ThinkEquity analyst Yun Kim mentioned in a research note. He rates shares hold with a $31 price target.

Analysts polled by Thomson Reuters expect the software giant to report quarterly earnings of 62 cents a share on $18.13 billion in revenue. Independent analysts surveyed by Estimize expect 64 cents a share on $18.36 billion in revenue.

Even though there are some concerns about sluggish PC growth in the quarter, investors may take solace that other parts of Microsoft's business are solid. Raymond James analyst Michael Turits said he believes the data center business, which includes Server, SQL Server, and System Center is solid, as is portions of the Microsoft Business Division (Lync and Sharepoint). He rated shares outperform with a $37 price target.

Again, Turits pointed the focus back to Windows 8 and several other products scheduled for release in fiscal 2013. "Overall we're positive on the company's aggressive challenges to structural changes in cloud and mobile computing with the overall Windows 8 strategy around client, mobile, server, and cloud and view Microsoft as a solid defensive play in the current macro," Turitis wrote in his research note.

Interested in more on Microsoft? See TheStreet Ratings' report card for this stock.

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-- Written by Chris Ciaccia in New York

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