Microsoft Corp. (MSFT)

All Comments on MSFT

  • commenter
    Gillian
    Wates
    May 16 07:09 PM
    Google, IBM, Red Hat, Sun and the Digistan Connection [view article]
    RV, I support Denis Biron's right to say freedom is for fascist terrorists who speak foreign languages. Clearly the world would be a better place if we all spoke English and ran the same operating system. The only free software would be viruses, which is good for the anti-virus industry. Lastly, I disagree that accepting free rides does NOT make you a fascist/communist. Reply
  • commenter
    Buzzly
    May 16 06:00 PM
    Microsoft in Perfect Position to Undercut Previous Yahoo Offer [view article]
    It is slow to come out. But here it is link for Ichan's Call/Put options on YHOO


    blogs.wsj.com/deals/2008/05/15/how-icahn...     Reply
  • commenter
    Michael B.
    Krause
    May 16 05:43 PM
    My Website
    Microsoft in Perfect Position to Undercut Previous Yahoo Offer [view article]
    Tom S:

    1) My calculations are based on the assumptions that search market share for MSN (and others: Yahoo, Google, etc) are fairly in line with their revenues. I am making (what some may consider disagreeable) a leap saying that search shares are consistent enough to get a handle on valuation. Is 100% of search worth $150B total? Maybe not search alone: but search, display and everything else that comes with it does come to that. MSN is worth more than search, but so are Yahoo and Google. So for blunt measurements (which are practical for such high multiple stocks), I think its appropriate.

    Add up Google, MSN, and Yahoo market caps and you get somewhere close, plus or minus normal volatility (recall GOOG was worth 25% less just a few weeks ago because analysts incorrectly pinned Google's growth curve).

    2. I meant revenue when referring to cash flow, not Cash flow on operations.

    3. I agree it may not be foolish to merge, but at such a high multiple, all benefits from the merger would be likely forgone with such an overpriced initial transaction. High risk, minimal reward.

    Lastly: $47B isn't a merger. Thats a money giveaway.
    Reply
  • commenter
    Michael B.
    Krause
    May 16 05:32 PM
    My Website
    Microsoft in Perfect Position to Undercut Previous Yahoo Offer [view article]
    You are definitely right that 16% earnings yield is not a normal return. You caught my error.

    I was a bit sloppy there - I made a causative assumption saying that since their real returns are much weaker (than even 6% earnings yield on such a high multiple that MSFT offered), that the likely result of such a collaboration would at best create normal (somewhere between the 58 multiple MSFT is offering and the best-case multiple of 6) returns for enormously high risk.     Reply
  • commenter
    Mr. Opine
    May 16 05:17 PM
    Video Game Industry: One of the Most Attractive Areas to Invest [view article]
    let's look at a few facts.

    1) if you were to annualize retail sales of the Wii (i.e. take April unit sales and divide by the percentage a typical April makes of the full year) you would see that Wii ran at a 22 million per year rate in April. That compares to 13 million for the Wii in March. The best month previously was the PS 2 in 2002 at about 18 million (infused by GTA 3 at the time). for PS 2 in 2002 at 18 million.

    2) the Wii is still supply-constrained. sales would be even higher if you could find it in stock every day at retail

    3) have you ever watched people play the Wii? it's more fun to watch them, than the screen. The experience defines viral: the enthusiasm spreads every time someone is exposed. I'll bet there are more people waiting to buy a Wii than have already been lucky enough to own it. I don't think that's close to end of life yet

    4) yeah, sure, forget about developing for WIi, DS and PSP. Everybody's got $15-$20 million around to do a game for all the 2-3 million guys who are hard core PS 3/360 players. Um, that market's not showing much growth. Bioshock, mass effect, great games--ran out of sales at about 1 million.

    5) the average Wii title is bought by about 2.2% of all Wii owners to date. This is below PS 3 and 360. It is better, however than the PS 2 after 18 months in market. The data shows that the Wii owner doesn't buy that much less software, but s/he buys a much higher concentration of first party.

    Based on all this, my conclusions are different!     Reply
  • commenter
    not_yet_bill
    _gates
    May 16 05:15 PM
    Microsoft in Perfect Position to Undercut Previous Yahoo Offer [view article]
    Not sure I understand your comment "Even if MSN+Yahoo immediately became the next Google, $47B right now would buy Google's earnings for 6 years. Why take such large risks for such normal returns?"

    You consider that a "normal" return. If you can get cash back in 6 years on a company buy-out, thats absolutely phenomenal. You might not have considered the fact that, the cash flow after 6th year onwards also stays with you only as a buyer and that too for ever. And that is all gravy since you have recovered your investment in 6 years.     Reply
  • commenter
    Tom S
    May 16 05:07 PM
    Microsoft in Perfect Position to Undercut Previous Yahoo Offer [view article]
    I concur with the above. I found a few things I disagree with in this article:
    1. I do not follow any of your valuation calculations. You say due to MSN "owning" 10% of the search market, this values MSN at $10-15B? Is this saying that the search market is $100-150B? That practically all of MSN's value is derived from search? (And the same math applied to Yahoo's value?). Regardless of how you got there, I'll give you a value of $21.42/share because that is near where it was at before the offer.
    2. I think instead of meaning $6B in Cash Flow, you were referring to $6B in Estimated Revenue? And Yahoo's and Google's margins are different and in this case not comparable. It is pie-in-the-sky to think that Yahoo's estimated Net Profit of $798M will come close to $2.2B. That is 176% higher than expected. And this is why Yahoo has a forward P/E of 48 at the moment and not 21.
    3. Based on Google's past growth, it will make $47B in less than 6 years... likely more around 4 years with the forecasts for overall search advertising and the other lines of business it is getting into. This is why it is not foolish for the two to merge--it is riskier not to as Google gobbles up the advertising spend.
    4. What incentive would Microsoft have to "come back to the table" when the shares hit 15-20. I think you would mean *Yahoo* will come back based on it being the one to hold out for $37. Microsoft is already "willing" to buy Yahoo at $33 or less...
    5. Microsoft's offer to buy at $31 (above your $21-25 target) was generous, not foolish. Microsoft wants to merge Yahoo with good will and retain top talent.

    and Buzzly--can you provide a link to the WSJ source? I'm interested in reading more. I have been watching the Calls and Puts and have not seen this volume/trading you are referring to.     Reply
  • commenter
    Michael B.
    Krause
    May 16 04:43 PM
    My Website
    Microsoft in Perfect Position to Undercut Previous Yahoo Offer [view article]
    $20B?

    Take a look at the latest 10-Q. $10.5B total stockholder equity, 2.2B of that being Alibaba.

    www.sec.gov/Archives/edgar/data/1011006/...

    My estimate of a $30B offer value on Yahoo is nearly a $10B premium on the cash flow valuation estimate, perfectly making up for these 'assets' you mention. Their interest in Alibaba is worth $2.2B according to their own 10-q.
    Reply
  • commenter
    pithant
    May 16 03:50 PM
    Microsoft in Perfect Position to Undercut Previous Yahoo Offer [view article]
    Concur w/James Z -- If you're going to publish either be informed or honest. YHOO has cash and investments worth some $20B. All your calculations are just pencil whipping without starting there. Then look at who they are. Still the biggest. Excepting GOOG, they are the gold standard of internet companies. Mr Softy is nowhere and sinking. They need YHOO more than the reverse. It's just another version of them bullying their way to dominance and it ain't pretty. 40 is the number they should pay, like they offered before they went hostile. Reply
  • commenter
    RV
    May 16 03:24 PM
    Google, IBM, Red Hat, Sun and the Digistan Connection [view article]
    stan means land. This guy is an absolute MORON. From now on, lets not give anything for free. Homeless, hungry and poor people must pay for their food and help (no more FREE rides). No more internet since almost all of the protocols underlining was developed for free or released for free, OpenOffice must be banned since it's free. No more web browser (Mozilal and derivatives are free, IE is free, Opera in free). Never mind that private companies like Red Hat, Suse, Ubuntu and others give their OS for free. banned them. Anyone who believes in free stuff must go to jail for being fascist or communist. I will notify my public library tha they are in violation since they give books for free every last Sunday of the month. No more of that, everyone must pay. From now my co-workers that ask me for a free ride to the subway station a few blocks away must pay me, no more free rides from me since I am not a fascist/communist. I am returning my toothpaste that included a a free toothbrush. My list is going to get very long. Reply
  • commenter
    simion
    May 16 02:21 PM
    Google, IBM, Red Hat, Sun and the Digistan Connection [view article]
    this is my last comment, you know nothing:
    i will tell you the truth
    1.computers are old then Microsoft
    2. the windows(the GUI elements not the OS) are not created by Microsoft
    3. Operating Systems are older then Windows and Dos
    4. internet and html are not Microsofr creation
    5. C and c++ are not Microsoft creation
    6 Please read more and write less, you seem stupid     Reply
  • commenter
    the2bears
    May 16 02:14 PM
    My Website
    Video Game Industry: One of the Most Attractive Areas to Invest [view article]
    This whole article is a link-fest to Bruce's Blog. Each link providing further proof of how little he actually seems to understand this industry.

    According to VGChartz, the DS has sold almost 250 million pieces of software to date. Piracy certainly hasn't stopped companies from making money there.

    This (Bruce's site) is all one big push to get his name "out there". It's naively written "shock" material, written either with the purpose of provoking controversy or accidentally doing the same.

    Bill     Reply
  • commenter
    James Z
    May 16 02:02 PM
    Microsoft in Perfect Position to Undercut Previous Yahoo Offer [view article]
    You completely mis-calculated everything. Yahoo has more than just search, let alone all those great investments in Alibaba, Yahoo Japan etc.

    Stop publishing stupid article like this one, period.     Reply
  • commenter
    mkreisel
    May 16 01:48 PM
    Microsoft in Perfect Position to Undercut Previous Yahoo Offer [view article]
    Why does MSFT have to buy YHOO?
    Reply
  • commenter
    Gillian
    Wates
    May 16 12:54 PM
    Google, IBM, Red Hat, Sun and the Digistan Connection [view article]
    From the terms of use, one may not:

    # Post any comment that is unlawful, harmful or injurious to others, threatening, abusive, offensive, harassing, derisive, defamatory, vulgar, obscene, libelous, hatefully, racially, ethnically or otherwise tortious or objectionable.

    Now I'm no Microsoft supporter but IMO "fascist terrorists based in countries and regions using the Farsi-based suffix “stan.” is threatening, abusive, offensive, derisive, defamatory, vulgar, libelous, hatefully, racially, and ethnically objectionable.

    Dennis, I'm no microsoft fan but seriously, you should apologise before lots of angry digistanis write to contact-editorial@seekingalpha.com expressing their shock and dismay that such comments would be published on a site like this.

    Just sayin'.     Reply

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