While consumer-tech giant Apple Inc. (NASDAQ:AAPL) is achingly close to hitting the $1 trillion market-capitalization level, another firm is making headlines. With its continued impressive performance, Microsoft Corporation (NASDAQ:MSFT) is now worth $749 billion. As it stands, MSFT stock is now the world’s third-most valuable equity.

Of course, anything can happen in the markets which can upset this recently-attained status. But no matter how you look at it, this is an immensely significant benchmark. For starters, MSFT stock overtook Alphabet Inc (NASDAQ:GOOG)(NASDAQ:GOOGL), which is now in fourth place. Google’s parent company has a market cap of $739 billion.

The other reason why this moment stands out is that it represents a complete reversal of fortune. Google is the new kid on the block, going public in 2004. In sharp contrast, MSFT stock debuted in the markets in 1986. Furthermore, Microsoft initially enjoyed its heyday during the 1990s and early 2000s, when physical software and cumbersome hardware ruled.

But Google is one of the elite companies that’s emblematic of the current generation. Starting life as a search-engine, and rapidly morphing into a jack-of-all-trades technological powerhouse, Google eventually passed Microsoft in 2012.

When it changed its name to Alphabet, the rebranded organization never looked back. MSFT stock seemed destined for irrelevancy.

However, credit Microsoft CEO Satya Nadella for engineering one of the most remarkable turnarounds in recent memory. Since the company announced Nadella’s promotion as head executive, MSFT stock has gained nearly 202%. Not only that, it’s been a fairly smooth ride to the top since the summer of 2016.

And just for bragging rights, Microsoft should be able to enjoy its newfound status for some time. GOOG stock has been pedestrian this year, with shares hitting a rough patch since mid-May.

MSFT Stock Is Flash and Substance

Certainly, long-term shareholders can bask a little in Microsoft’s glory. The company was chasing fads and failing to live up to its potential from the mid-2000s onwards. This proves that even in the most technologically-advanced era, people are the most important assets to an organization.

However, I’d also caution new buyers to not read too much into the third-place ranking. Don’t get me wrong: I think it’s a brilliant accomplishment. But such benchmarks also tend to produce disappointments. Case in point is Apple, which is still chasing $1 trillion. Curiously, AAPL has been flat over the past few weeks.

When – or should I say if – AAPL hits $1 trillion, I have a gut feeling shares will retreat. Apple competes in highly-saturated markets, and it will need more than war stories to keep buyers interested.

But this is the reason I’m much more bullish on MSFT stock. Microsoft learned some tough lessons under former CEO Steve Ballmer’s tenure. The company is applying them and it’s paying off dividends. Its competitors like Apple have yet to be tested so severely.

Furthermore, a major reason for Microsoft’s turn-around success is substantive strategies. The house that Bill Gates built fully embraced the Software as a Service (SaaS) concept. Today, MSFT offers multiple solutions for every need.

The immensely popular Microsoft Azure provides cloud-based and scalable applications for businesses. Also available under Azure are platform and infrastructure solutions. For individual needs, Microsoft Office 365 is, in my opinion, a godsend. With several attractively-priced plans, you can have all of your communication and application platforms under one umbrella.

On the flipside, I think this is where Alphabet lags. Microsoft actively generates revenue streams, while Alphabet depends largely on advertising revenue.

Management Has a Smarter Approach

In praising MSFT stock, I don’t want to sound critical towards GOOG. I like both investments. However, the challenges and failures that Microsoft endured made it a stronger and smarter organization.

That’s reflected in its financials. In the past four years, Microsoft has mostly kept its selling, general and administrative (SG&A) expenses stable and consistent at around $20 billion. What has changed is a ramp-up in research and development expenses. But that’s exactly where tech companies should invest their resources if they want to stay relevant.

Microsoft has done exactly that and more. For instance, no matter how many smart devices flood the consumer-tech market, people who want to get stuff done (have you tried doing spreadsheets on a tablet?) turn to Microsoft. Even its hardware, such as the Surface, effortlessly marries form and function.

At some point in the future, MSFT stock will make its own run towards $1 trillion. The difference is that Microsoft has a great chance of sustaining the milestone.

As of this writing, Josh Enomoto did not hold a position in any of the aforementioned securities.