Microsoft Corp (MSFT)

The investment thesis on Microsoft is very good. They converted from software to cloud computing and have done a fabulous job of this. In future, they can grow dividends and stock buybacks. Balance sheet is fabulous. Not a lot of reasons why you would not buy it.

They are modeling they can grow 15% 2018-2020 compounded annually. Trades at 20 times. A little expensive but the growth is there. He thinks it has legs long term.

They recently reported very strong earnings and have good success in the cloud technology. He likes the dividend growth. The stock is getting more expensive, so it is a good hold here.

Until 2016 there was a flat consolidation, then the new CEO took the company higher. They're executing superbly and reported strong earnings. Their year-end is June 30, and it can be soft in July-September. But he sees nothing wrong with their chart.

Owned it for a long time. Technology moved from enterprise to consumer and now going back to enterprise. The cloud is still very small compared to other aspects. Still lots of companies can move and this company is well positioned for that. Generating lots of cash. Good profitability. They are in a sweet spot and continue to do well. They have a lead on the cloud.

An impressive run, but we're seeing now impressive revenue growth from their Cloud and legacy businesses. Their margins are a little compressed from spending on new initiatives. -26x earnings, but they are walking the walk. A good
company.

He still likes it although it is not a bargain any more. The free cash flow conversion is quite high in this company. They have done a good job of high grading the quality of revenues of the last couple of years. You are paying a fair price for it and if you are in it for a long time you will be okay in the stock.

They seem to be riding gaming, the Cloud, other software--all the right waves. If you want to run an office, you have to pay them to use their software or Cloud. An amazing company. The problem is the valuation has gotten ahead of itself
at 27x earnings. It's a new company. Kudos to the CEO. Ultimately, if you believe the Cloud is in its infancy, buy it--but at a 10% pullback.

He bought it when it had been trading sideways for a long time. Then the sky was the limit and he remains bullish on this one.

It has a solid franchise. They recently extended their runway by buying GitHub for over US$7-billion, which meshes nicely with their Cloud operations. Essentially, it extends business-to-business communication. This was a smart move.

It is expensive, but he still likes it. The CEO is one of the best out there. They morphed into the cloud business exceptionally well. They still own the largest operating system out there. Growth still ahead. Great asset. Core holding for him in the IT sector. A winner even if the price of the stock went a little ahead of itself.

(A Top Pick Sept 27/17, up 39%). Was a hated stock about 5 years ago. Have moved into the cloud business and adapted to the changes in IT. Are in a very strong position. A lot of people still use their products. A lot of stability. Cloud is a growing business and they are a large cap that is experiencing accelerated growth. Expects 10-20% upside in the next year.

You might think slow and steady. But it had a 93% growth in one of its sectors. They are a dominate player in the cloud, along with GOOGLE and Amazon. They put up 31% revenue growth over the year. Yield 1.7%. (Analysts’ price target is $112.24)

It has really reinvented itself. It was THE growth company through the late '80s and through the 90's. They were assigned a generous multiple and they were a big winner in that period. They are number 2 in the cloud. It is a huge growing area and the market has fallen back in love with them as they are now a growth story again. It is a bit of a 'Show Me' story. There is a lot of choice in technology.

Has long owned it and still likes it. The new leadership has reinvigorated the company, like a dynamic start-up. The Cloud business has huge potential as more people use it. Huge growth coming. MSFT can offer services in the Cloud. It's not a cheap stock now, but fairly valued.