Headquartered in Washington, Microsoft (NASDAQ:MSFT) is known for providing Office, Teams, Skype and other software products, along with cloud computing and artificial intelligence (AI) services. For an all-weather technology holding, investors would be hard-pressed to do much better than MSFT stock.
Some detractors might call Microsoft a “legacy business” because it has been around for so long. Once considered a risky, cutting-edge software company, Microsoft might now be shunned by younger investors seeking excitement elsewhere.
That’s a shame because Microsoft isn’t just the company that brought us the sometimes buggy Internet Explorer. As the company finally puts that old browser out to pasture, it’s time to reassess Microsoft’s status as a trailblazer in 2020s technology.
What’s Happening with MSFT Stock?
Considering the circumstances, MSFT stock has held up fairly well in 2022 so far. After all, there’s a tech-stock rout going on due to high inflation, supply-chain issues and an aggressive Federal Reserve.
So, perhaps we can forgive Microsoft if its shares have fallen from $335 to $245 this year. The silver lining here is that Microsoft’s trailing 12-month price-to-earnings ratio is quite reasonable at 26.44. In addition, the company’s loyal investors can collect a forward annual dividend yield of 1%.
Still, millennial and Generation Z traders might wonder why they should bother with MSFT stock. They may scoff at Internet Explorer, which Microsoft just retired after 27 years. Will Microsoft only be remembered for that ancient browser?
Certainly not. Microsoft has a variety of technology-focused business interests that aren’t limited to browsers. Among the most notable is Azure, Microsoft’s cloud product and service. Reportedly, Credit Suisse analyst Phil Winslow believes that Microsoft can grow Azure “‘faster and bigger’ than what Wall Street expects.”
Winslow envisions a compounded growth rate of nearly 41% through 2025 for Azure. With that in mind, Winslow expects Azure to “drive sustained growth for Microsoft and meaningful upside to consensus estimates.”
Addressing Threats and Bringing Teams Together
Still not convinced? No problem. Microsoft is also venturing into two modern tech segments that have nothing to do with Internet Explorer.
First of all, Microsoft plans to acquire cyber threat analysis and research company Miburo. That company, which specializes in identifying and responding to foreign information operations, will “enable Microsoft to expand its threat detection and analysis capabilities.”
Additionally, Microsoft is moving forcefully into the customer relationship management technology (CRM) market with a seller experience application called Viva Sales. Like an artificial-intelligence-powered sales coach, Viva Sales will empower sellers to “be more connected with their customers, resulting in more personalized customer engagements and closed deals faster.”
Granted, Microsoft doesn’t enjoy first-mover status in cybersecurity or in CRM. Nevertheless, Microsoft is well capitalized and has wide name recognition and respect. So, the company could prove to be a redoubtable competitor in these niche markets.
What You Can Do With MSFT Stock
Some folks will be glad to say “good riddance” to Internet Explorer. Yet, investors don’t need to be skeptical or cynical. Instead, they can celebrate Microsoft’s future endeavors.
Besides, Microsoft offers a decent dividend and the company’s shares offer a good value at their current price point. The takeaway here is that investors of all ages can hold MSFT stock with confidence for the long-term as Microsoft remains as modern as ever.
Microsoft currently earns a “B” in my Portfolio Grader.
On the date of publication, Louis Navellier had a long position in MSFT. Louis Navellier did not have (either directly or indirectly) any other positions in the securities mentioned in this article.
The InvestorPlace Research Staff member primarily responsible for this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.