Microsoft Could Hit Its Trading Target Within Days

by Sam Collins | May 17, 2013 1:21 am

Microsoft (NASDAQ:MSFT[1]) — “Mr. Softee” may finally be coming out of an 11-year slump. The stock hit a five-year high Thursday, as primarily institutional investors appear to be placing a high value on future growth. Outstanding growth in its video game business, a large stake in “the cloud,” stable cash flow, a regular stock buyback program, and a 2.8% dividend yield add up to higher earnings and share price.

Recently reported fiscal Q3 2013 earnings came in at $0.72 per share versus expectations of $0.68, up from $0.60 in the year-earlier period. Earnings per share (EPS) for fiscal year (FY) 2013, ending in June, are expected to be $2.68, while $3.09 is estimated for FY 2014 and $3.37 for FY 2015.

Early in April, MSFT broke through its long-term bearish resistance line with a high-volume breakaway gap. Since then, it has been under heavy accumulation.

The trading objective is $38, which could be met within days. Longer-term investors could pocket a sizable return from this software powerhouse.

MSFT Chart
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Trade of the Day Chart Key[2]

Endnotes:
  1. MSFT: http://studio-5.financialcontent.com/investplace/quote?Symbol=MSFT
  2. [Image]: http://investorplace.com/wp-content/uploads/2011/04/chart-key.gif

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