Significantly, Microsoft, an American leading multinational technology company, has been powerful during the COVID-19 crisis. Stocks have performed well, which was caused by cash flows and continued growth in core businesses.
However, the company witnessed a decline. The recent market correction took shares to $200 from $340 in the week.
Investors try to find out if further corrections will pull shares down again. Satya Nadella, the company’s CEO, has presided over a period in which the stock has increased several-fold.
Although Microsoft’s current failure to acquire TikTok will only fuel negative speculation, these minor difficulties don’t make Microsoft a sell by any means.
The company has been bold in its acquisition strategy under Satya Nadella. The corporation bought LinkedIn, GitHub, and Mojang AB, which owns the game “Minecraft” during Nadella’s tenure.
TikTok has instead decided to partner with Oracle. It could be discussed that this is a loss simply because Microsoft’s rival won out contract negotiations. Yet, some Microsoft owners see the upside to the conclusion.
Microsoft would increase its dividend to 56 cents
The company reported that it would raise its dividend to 56 cents, and that dividend will be paid on December 10 and represents a 10% gain over its last payment.
Investors who think Microsoft is overpriced and due for a greater correction can breathe a bit easier.
Suppose we compare Microsoft stocks to the other leading companies, for example. In that case, Apple and Cisco Apple and Cisco are in the same industry, and we can use the P/E ratio for comparison’s sake. Using this very simple model, we find that PE ratios for Apple which is 35.66, Microsoft – 34.1, and Cisco – 15.37.
However, investors are much more willing to pay for a piece of Apple or Microsoft earnings than Cisco.
