techtonicbull, what makes you think that the multiples ascribed to SUNW, CSCO, AOL, HWP and ORCL are apropos to their fundamentals. Have you looked at their cash balances and their PE's? Why don't you compare them with MSFT's $43 billion in cash and investments, MSFT's PE of 45 and the company's net margins.
I used to think that the Net was going to render the PC obsolete but after careful deliberation I came to the conclusion that the Net was only going to be an extension to the PC. This is where MSFT' NGWS will be crucial in the company's evolution into the Net. Only a fool would bet against a company like MSFT, especially with its' pool of talent and wherewithal. In the coming quarters you will begin to see the company's new products, from PocketPC, X-Box, Windows 2000 and its' NGWS come to their fruition.
The only obstacle in MSFT's way is the Appellate courts. I find it difficult to believe that the higher courts would uphold Judge Jacksons' ruling. Nevertheless, the courts can not arbitrarily impose severe sanctions against a company absent of any manifested fraud. To date MSFT has not been found guilty of committing any fraudulent acts. Their only crime has been using their affluence to dominate markets they compete in, isn't that what Cisco, Intel and SunW practice in doing their businesses. The Japanese and Europeans are guilty of the same behavior. Msft's DNA is very much different to that of Standard Oil or for that matter ATT.
The next question begging to be asked is how much lower will Msft fall? Is the stock already discounted to include the DOJ so called "findings of fact," and their 3Q earnings results? In relative terms MSFT appears to be the better investment when you compare it with CSCO, SUNW, ORCL and AOL but this market does not credit common sense, Monday will manifest if we have truly redressed our paradigm to make fundamentals once again the premier attribute contributing to value. |
