Worst Performer: Microsoft
My second loser is Microsoft (NASDAQ:MSFT), whose stock, while up 4.3% year-to-date through March 11, is the fifth-worst performer in 2013 of the Dow 30.
Over any period, whether short-term or long, Microsoft has gotten killed by the Dow. In fact, since Steve Ballmer took the reigns as CEO in 2000, its stock has achieved a total return of 15% compared to 600% for Google (NASDAQ:GOOG) and 6,000% for Apple (NASDAQ:AAPL). At some point, Microsoft investors must realize that the opportunity cost of holding its stock far outweighs any gains it can generate.
Now I’m the first to admit I’d be the last person to ask for advice about the technology industry, but when Bill Gates, probably one of the most reserved CEOs in American corporate history, comes out on CBS questioning some of his pal’s moves — including its mistakes in mobile — you really have to wonder if Ballmer is the right man for the job. A 15% return over 12 years suggests investors agree.
When former Microsoft executives are comparing the tech giant to the Republican party, you know innovation is non-existent in Redmond.
The only way I could recommend MSFT stock would be if it doubled its annual dividend to $1.84 per share. With $28 billion in free cash flow, it could do it. But Microsoft won’t do that because that would mean being innovative — and we all know it’s not.
As of this writing, Will Ashworth did not hold a position in any of the aforementioned securities.