<p>In the wake of the new coronavirus pandemic, markets experienced record sales. Even high-performance stocks such as Microsoft (NASDAQ: MSFT) felt the effect.
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MSFT reached $ 188.70 on February 10 before falling to a closing of $ 135.42 on March 16. However, Microsoft shares have been a powerhouse for the past five years, and the coronavirus has not been enough to keep it down.
In fact, the shutdown has helped increase the use of Microsoft products such as Skype, Teams and Xbox Live. With MSFT currently trading around $ 165, time is running out for investors looking to buy on dip.
Microsoft is a machine
Coming into March, Microsoft was a company that shot at all cylinders. Office 365 subscriptions rolled in. Its Surface PC hardware was about to become a business of $ 2 billion per quarter. In October last year, its Azure cloud computing division Amazon (NASDAQ: AMZN) beat AWS for an estimated US $ 10 billion US Department of Defense contract. The company even managed to avoid being fucked by the antitrust sentiment that plagues competitors like Apple (NASDAQ: AAPL) and Alphabet (NASDAQ: GOOG, NASDAQ: GOOGL).
The closest thing to disappointing MSFT investors in recent years was Sony (NYSE: SNE), which beat Xbox One with Playstation 4.
Over the past five years, Microsoft’s shares have increased by almost 300% and even after the coronavirus market melted, the company’s market capitalization is comfortably over trillions of dollars.
Coronavirus Boost for Skype, Teams and Xbox Live
The coronavirus pandemic and the resulting deadlock have seen the use of some Microsoft products skyrocket.
Zoom Video Communications (NASDAQ: ZM) saw a tremendous increase in the use of its Zoom video conferencing application, but it was soon tracked down by security issues. Meanwhile, MSFT has seen its Skype video conferencing tool – with enterprise-level security and Office 365 integration – increase usage by 70%.
Teams is MSFT’s answer to Slack (NYSE: WORK). Microsoft’s group collaboration tool (and another Office 365 component) has seen its adoption boom. The company reported that in mid-March, the total number of logged minutes of team meetings was 200%.
When life has returned to normal, the boost for Skype and Teams will help Microsoft sell more Office 365 subscriptions. Microsoft’s Xbox Live online gaming service has also seen a huge increase in usage. Demand actually came to a halt several times in mid-March, although MSFT quickly increased capacity and introduced measures such as moving downloads to game hours.
Looking forward: Xbox Series X
The sharp increase in demand for Xbox Live is also good news for MSFT. This fall, the company is expected to launch its next-generation video game console, the Xbox Series X. All the while, it will help pump the pump for a new video game experience.
Xbox One sales never lived up to expectations and had dropped significantly in recent months as gamers waited for the next generation of consoles to arrive. Microsoft gets another chance to take on Sony and even if the Xbox Series X does not take the crown from the Playstation 5, the MSFT share will look upwards in the sale of holiday consoles.
The conclusion of Microsoft Stock
Almost all populations have seen their value drop significantly in the wake of the coronavirus pandemic. But few of them are seen as the buying opportunity that MSFT is.
Of the 34 investment analysts surveyed by the Wall Street Journal, 27 Microsoft shares were rated as a buy with four more ratings as overweight. These figures have been broadly identical for the past three months. The current average 12-month price target is $ 188.90, which is up 14%.
MSFT bounces back quickly from its low end of $ 135.42, in the wake of the large market sales in March. It has increased by almost 22% since the low point. In fact, MSFT has now posted a gain of 4.7% so far in 2020 – despite the coronavirus outbreak. If you have any interest in adding Microsoft to your portfolio at a discount, you need to act quickly.
At the time of writing, Brad Moon had no position in any of the above securities.