Although I am fully invested in MSFT and won’t be adding shares in MSFT, that doesn’t mean you shouldn’t buy MSFT at this time.
Top Reasons why I rate MSFT a Buy
1. Enterprise spending expected to return in 2010 Microsoft will be a major beneficiary with server and enterprise solutions.
2. Consumer spending on technology & electronics is showing strong signs of recovery: Read XBox and Notebooks.
3. Microsoft is gaining market share with search engine, Bing.
Microsoft’s stock is now trading at 14x consensus fiscal 2011 EPS estimates. This is a discount to the relative valuations of their peer group. Microsoft’s improving outlook and multiple growth catalysts should lift the stock further in 2010.
When MSFT hits my target of $35 I will sell 1/4 of my position.