Microsoft Corp. - Prudence is Much Different from Greed - Caution is Warranted
Microsoft Corp. remains one of the leading Dow 30 - Industrials composite Companies. My Indicators are breaking down and I am preaching "prudence."
Microsoft is hanging in there very, very well. However, there is a possible Technical problem developing and Earnings are not all that impressive. So far - - just a word to the wise.
My previously written articles on MSFT (just click) provide you the history of my forecasting, its accuracy and support for my performance. For over 50 years my management objective is to identify changing trends for my forecasting analytics. I simple want to have current notes to quickly refer to on the anticipated direction of this company and its industry peers.
My Performance for Microsoft can be found below and is nearly 20% per year for the last 5 years.
Look at the Profits for MSFT - Over the Years
It is simple, all Companies Cycle from "Favorable" to "Un-Favorable" and in between, they are "Also Rans." This horse-racing metaphor is the best guidance I have to explain how to know the Good / Bad and the Ugly for all securities on the planet.
Microsoft - has: a) gone relatively nowhere in 20 years - - SO - - (study the peak to peak and trough to trough); b) is UP over 100% in Favorable time-frames; is DOWN over 50% in Un-Favorable time-frames; and c) has spent years as an "Also-Ran." The Company - has: a) gone Up in 20 years (study the peak to peak and trough to trough); b) is UP over 100% in Favorable time-frames; is DOWN over 50% in Un-Favorable time-frames; and c) has spent years as an "Also-Ran." What a Waste of time and money during "Un-Favorable and Also-Ran time frames - don't you think?
The Company like so many others has taken some big hits over the years!
Have a long look at this Chart, it tells you a story about how to make and preserve your profits. Click on MSFT. It is not hard to understand how Bear Markets can cause financial set-backs for years and in many cases those set-backs are never recovered. I have over 50 years of successfully doing what I call "preventative maintenance."
Make just a 5 - 10 minute Study of this chart and the others I provide in similar articles you will be convinced that "Being Selective" with the "What" and the "When" of investing your money you will become a very profitable Investor. It is my clear answer to being a Consistently Profitable for my Clients. If you are not "convinced" - - then - - stay with your mutual funds and remain an Investor willing to accept Up and Down performance similar to this Company over the coming years. I suggest that - You deserve Better . . .
( Please go-to my Wednesday - Thumb-Nail - for my articles on ""Sectors." )
You can do better / have it all and I can teach you how !
More Support for My Dow 30 Forecasting Accuracy
The following article supports my Methodology of "Investing Wisely" and with superior and consistent annual profits. Just Click.
My management objective is to identify changing trends for my Forecasting Analytics. Simple stated, I want to have current notes to quickly refer to on the anticipated direction of this Sector and Industry Group.
A Special Note for Seniors & Retired Investors - Dividend Yield: 2.77%
I believe you folks deserve much better service and investment direction and guidance that either Wall Street or the Brokerage Community is / has been providing. Being a retired Asset Manager / Financial Analyst is a joy for me to assist you and meet your investment - needs, goals and objective. Peace of Mind for you is my mission.
Forecast w/ 5 Year Performance
Microsoft Corp. and other Software Companies are tracking the Market well. (NASDAQ:MSFT) remains in a strong Rally it is always an excellent contributor to my Analytics. Unfortunately, I suggest it is beginning to tell a Bearish Story. . . My Forecasting of Microsoft over the years has been near perfect.
Note: The below Table is for your review, questions and perhaps thoughts. If you are seeking to "Invest Wisely" in my "Growth & Income - Asset Allocation Model" - - please Email me to open a dialog on how I go about providing super performance with a very low threshold of Risk.
My Current Forecast is not as bright as you may think! (I will be more specific upon request).
If you own or are considering owning a Software / etc. Companies, the securities have definitely become much less bullish than just six months ago. Mostly strong but like always you need to find the best through being very selective. Microsoft is currently strong Technically but I have reservations about my Fundamental Valuation, therefore I have placed it on an Initial Bearish Forecast - "Warning."
My Current Opinion is to HOLD in anticipation of taking profits.
* Fundamentally - ( weighting - - 40% ): My Analytics (weighting - 40%) for my Fundamental Valuation play a vital role in profitable managing money. At this time my Valuations of (MSFT) are not as positive at perhaps you are being told by other sources. Plainly stated Earnings are Improving and then Descending again. This does not make for a positive fundamental valuation of any Company.
* Technically - ( weighting - - 35% ): Even with this fine Company, my Indicators are notably breaking down. It is currently selling off its highs of $40. I am recommending much Caution.
* Consensus Opinion - ( weighting - - 25% ): My third pillar of Research is one that is ALWAYS distorted to the Positive by most all financial analysts. That's because they are afraid of being Bearish. I Am NOT! My articles on "Reality" are supportive of the below 20 year Chart.
I will personally and promptly reply to any serious investor's inquiry as to my very cautious position for (MSFT) !
"Selectivity" is what I preach (along with Discipline & Patience) and is what separates the Average Investor and Mutual Funds from the profits that come with long-hours / hard work and "Selectivity."
Here are a number of the Component Companies / Peers in the Software Industry Group that I focus on rather frequently: (MSFT), (NYSE:ORCL), (NASDAQ:SYMC), (NYSE:CRM), (NASDAQ:CDNS), (NASDAQ:NUAN), (NASDAQ:CA), (OTCQB:CPWR), (NASDAQ:ADBE), (NYSE:VMW), (NASDAQ:ADSK), (NASDAQ:BMC), (NASDAQ:CTXS), (NYSE:PAY), (NASDAQ:CHKP), (NYSE:NQ), (NASDAQ:INTU), (NYSE:SAP), (NYSE:SWI), (NASDAQ:FIRE), (NYSE:RHT), (NASDAQ:INFA), (NASDAQ:NEON), (NASDAQ:JIVE), (NASDAQ:SREV), (PMTC), (NASDAQ:CNQR), (NASDAQ:CVLT). There are many, may more!
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Smile, Have Fun, "Investing Wisely,"
MSFT, ORCL, SYMC, CRM, CDNS, NUAN, CA, CPWR, ADBE, VMW, ADSK, BMC, CTXS, PAY, CHKP, NQ, INTU, SAP, SWI, FIRE, RHT, INFA, NEON, JIVE, SREV, PMTC, CNQR, CVLT