Also in this playlist...
This transcript is automatically generated
Microsoft announced a dividend boost and roughly twenty to -- that percent and a new stock buyback program forty billion dollars worth.
Just two days before shareholders have that chance to question management about who's going to take over.
When CEO Steve Ballmer calls it quits joining us now is Norman young he's an analyst at Morningstar.
And this announcement today surprised investors but not dramatically and in fact the stock while up isn't up really that much has been flat what the last ten years.
That's right admits it's roughly been about flat for the last ten years if you go back that far.
-- and like you set like this was not a complete surprise look the forty billion dollar reauthorization.
Was about to expire on on the last deal so they needed a new share repurchase authorization.
The dividend increase was probably a little bit larger than people expected but it was still within the realm of of a comfortable margin there but there was also -- Article -- read talk about value act capital which now has a seat on the board Mike they have been the pressured up the dividend to what wouldn't.
Will we see more pressure on Microsoft that could one big perhaps.
Hurt -- you want to reserve your cash.
-- that that's a good question and and book value -- is is definitely an activist investor but.
For the most part they typically take a longer term view maybe they have a little something to do with what happened here today with the dividend increased but.
-- they they're typically invested I think on a three to five year time horizon and and what they care about more is is kind of the competitive position in the Microsoft's products is that.
Now okay let's talk about that seven point two billion to -- Nokia I know in the United States you don't talk a lot about the Microsoft phone system it's usually android or apple.
But over in Europe over in Asia doesn't have more traction and could get position Nokia.
Give them today kind of -- -- to go faster and forward at a pace that would make investors like value act happy.
Right seeing you make a very good point.
-- in the US that they're still kind of a distant third place.
But the Windows Phone software -- it actually has had decent market share in place -- Great Britain Germany.
And you then please select Mexico where it's it's approaching you know the top one or two in market share.
So that the acquisition of the Nokia handset business we think.
This really Microsoft doubling down on what they perceive it as kind of what is important to them strategically.
Certainly I think it'll be easier for them to make strategic decisions.
Depending on hardware and what they want to be with the software so if anything it should help going.
-- all right 77 billion dollars in cash roughly how do you get this company to get its share price up I mean it has been flat as we've talked about for several years and nothing seems to give it a boost.
-- now that's a good point so.
So the important thing to consider though is like look share count has actually come down by about 20% of the last.
Last ten years.
The dividend has increased every year since the the end of the recession.
Revenues have grown almost threefold send it over the last ten years and and net net income is also -- a look.
Bet there -- kind of proceeding.
And they're building the company.
Fundamentally when it comes the numbers but I think the problem of course is -- and everybody kind of sees this is strategically.
They seem to kind of fall behind and a couple of important levels.
So -- given that in mind do -- hire from within to replace Steve Ballmer do you go without.
You go for someone knows may be former apple executive -- someone else.
That's a difficult question you know I -- I don't know I suspect -- they will probably be looking for somebody with a little bit of both maybe somebody with some some experience running a very very large.
Multinational technology software and hardware company.
And maybe somebody but knows that you know look there are a lot of different moving parts here Microsoft so maybe hiring someone from the retail side or whatever may not be the right fit.
But they certainly need somebody to -- to figure out what they need to do next especially since they just read recently announced that reorganization.
Mean do you think and on Thursday you think you'll get a list of names of serious contenders.
I doubt that -- up -- on that I'll give you the final word Norman young thank you very much.
Filter by section