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As earnings season continues, more prominent tech names will come to bat Thursday with a chance to proclaim why they are deserving of the Street's respect. So far, the number of companies that have beaten earnings have exceeded the number of those that have missed. But it only takes one polarizing name to shift the tide.

In this article we are going to look at Google and Microsoft, two strong names that are heading in opposite directions. From a valuation standpoint, it also seems that Google is considered expensive solely based on an $800 target, while Microsoft is perceived cheap. This is even though their underlying fundamentals are drastically opposites. I've also supported my arguments by looking at companies within their respective categories such as Facebook and Oracle that deserve consideration. Let's see if you agree.

Buy Google (GOOG)

Shares of Google have seemingly hit a wall ever since the stock reached its 52-week high of $844 several weeks ago. Investors have had a hard time reconciling whether or not the share price was justified. However, to take a position in Google today, investors need to also consider that the company has grown over the past three years under brutal market pressure and weak ad spending.

Now, given that the economy has shown signs of improvement, this only heightens Google's true growth potential and what the company should be able to achieve over the next 18 - 24 months. Remarkably, even at $800 per share the stock remains relatively cheap with a P/E of 24, especially when compared to a company like Amazon (NASDAQ:AMZN), which trades at a P/E of more than 3000.

While Amazon differs from Google's businesses, strictly from an operational standpoint, Google has more than a 25% advantage over Amazon in operating margin. And Google's profit margin of 21.40% is better than Amazon's by 21.40%. So given these comparisons, it's hard to make the case that the stock is expensive, especially for a company that is posting almost $3 billion in profits. Meanwhile, Amazon's main issue has been profitability and rising costs.

On Thursday, the search giant will look to build its case when it reports first-quarter earnings. Investors will be looking to see if Google can expand on a dominant Q4, during which revenue surged 36% with net income arriving higher by almost 7% year over year. Google's execution has been solid. Plus, with the Motorola situation now being resolved, Google's future remains as bright as ever. I would be a buyer here ahead of earnings.

Consider Facebook (NASDAQ:FB)

I will cover Facebook in more detail in a later piece, but given my bullishness for Google, it makes sense to discuss a few Facebook considerations here since these two compete for the same advertising demographic. Besides, given Facebook's new "Home" on Google's Android platform, it's fair to say that these two are becoming more "friends" than they are rivals.

What's more, this new attitude is also showing in Facebook's results. In its most recent quarter, Facebook posted a 40% surge in revenue which resulted in a net income of $64 million, or 3 cents per share - beating both top and bottom line estimates. Impressively, Facebook's monthly user base grew 25% year-over-year to 1.06 billion accounts.

Remarkably, about 680 million of them access Facebook using a mobile device each month, which affirms why Facebook's "Home" will spur more growth and ad revenue. Facebook is now performing as well as can be expected. Although the company is certainly not out of the woods just yet from a growth perspective, the company is at least moving in the right direction.

Impressively, given Facebook's new relationship with its rivals, the company seems more mature in its execution and is now allowing its performance to do the talking, not just its ticker symbol. So, as with Google, there's plenty of growth potential for Facebook and this stock can reach the low $40s by the end of the year.

Sell Microsoft (MSFT)

Microsoft has been in the news quite a bit recently and unfortunately it has been for the wrong reasons. Given recent reports about slumping PC sales, the fact that a significant portion of Microsoft's business still comes from Windows and Office is a concern. While Microsoft has been making some strides and has improved in some key areas such as the cloud, the pace of the company's progress has not been enough to offset fears about leverage.

On Thursday, the software giant will have an opportunity to either affirm or dispel rumors about its morbid future. However, the Street has not been too optimistic about the company's prospects with earnings-per-share estimates falling by over the past month by 3 cents to 74 cents per share. Looking on the bright side, this is still 23% higher year over year when Microsoft earned 60 cents per share. Revenue is expected to arrive at $20.56 billion.

It's worth noting here that Microsoft has not exactly wooed the Street over the past four quarters with revenue growth averaging only 1.2%, including just 3% growth in the most recent quarter. While bulls argued that Microsoft grew 34% sequentially, it was also during the holiday quarter. Plus, the company had just released its Surface tablet and Windows Phone.

Today, I don't see any compelling reason to hold these shares as long as Microsoft remains dependent on PC sales. I recently suggested that it was time for Microsoft and CEO Steve Ballmer to part ways. Many readers disagreed and suggested that the stock was doing well trading at $30.32. Since that article, the stock has dropped 13%. Absent some clear signs of progress in mobile, this slide should continue.

Consider Oracle (NYSE:ORCL)

Instead of Microsoft, I would look to add shares of Oracle, which has been punished for a recent miss on earnings. The question, however, was why? At first glance, I can see why the Street grew concerned. Aside from missing both top and bottom line estimates, the degree of the miss was pretty meaningful with revenue arriving more than 4% below estimates.

However, the quarter has little to do about Oracle's future and it was more reflective of poor sales execution, which management made clear will get resolved by the next quarters. The good news, though, is that Oracle is now able to better leverage the things that it already does well such as its cloud portfolio.

With its recent acquisition of Acme Packet, which brings with it the Net-Net line of devices, Oracle now has a one-stop-shop advantage that Microsoft is unable to match. And investors shouldn't ignore how cheap the stock is now at $32. With 2013 earnings estimates being $2.69 per share, the stock is now trading at a P/E of just 12, or 6 below the S&P 500 average of stocks in Oracle's category.

Source: Thursday's Tech Earnings: 1 Buy, 1 Sell, 2 To Consider