Recent Buy

buyFirst off, I want to thank all of you readers out there that purchased my book – you guys made it the #1 best seller on Amazon right now for Kindle e-books in the Stock Market Investing category. Thank you so much!

With that said, let’s get into some stock talk. 

I was fortunately able to put some more capital to work one last time this month. This will for sure be my last stock purchase for April, but I had a little excess cash sitting around and I just didn’t like that. Lazy money is bad money. I want my money to work for me so I don’t have to. That way I can be the lazy one, if I so choose.

I don’t know if I’m feeling a bit more adventurous lately, but this is my second transaction this month in the tech sector. I’m personally not a big fan of the sector as a whole, but a couple things are happening here. First, my portfolio has grown significantly over the last few years while I’ve simultaneously almost completely avoided tech. Thus, the portfolio’s weighting there is perhaps light even for my tastes (my exposure is almost nonexistent). Second, I’ve come to realize over time that many of the high-quality, blue-chip tech companies are absolute cash cows.

My strategy with tech going forward is basically to keep my exposure light to the entire sector relative to my portfolio, diversify between a few small positions, focus on major blue-chip companies that sell ubiquitous products and/or services – the true cash cows of the industry (nothing nascent) – and make sure I understand as much as I can.

Keeping to that strategy, I initiated a position in one of the most well-known tech companies in the world.

I purchased 25 shares of Microsoft Corporation (MSFT) on 4/17/15 for $41.28 per share.

Overview

Microsoft Corporation develops, licenses, and sells a range of software and services; and designs, manufactures, and sells a variety of hardware.

Some of the company’s main products and services include Windows, Office, XBox, Azure, Bing, Surface, and Windows Phone.

Fiscal year 2014 revenue breaks down by the following five operating segments: Commercial Licensing, 48%; D&C (Devices & Consumer) Licensing, 22%; D&C Hardware, 13%; Commercial Other, 9%; and D&C Other, 8%.

Fundamentals

Microsoft is well-known, but thought of as perhaps a staid company representing old tech. However, their growth over the last ten years tells a far different story.

The company’s revenue increased from $39.788 billion in fiscal year 2005 to $86.833 billion in FY 2014. That’s a compound annual growth rate of 9.06%.

It gets better.

Earnings per share grew from $1.12 to $2.63 over this time frame, which is a CAGR of 9.95%.

So we can clearly see they’re not dying off. Now, some of that bottom-line growth was due to extensive share repurchases – the company bought back approximately 23% of the outstanding shares over the last 10 years. And they authorized a $40 billion share repurchase plan on September 30, 2013.

S&P Capital IQ is predicting that EPS will compound at a 9% annual rate over the next three years, which is nearly in line with what we see above.

The company’s clearly growing, but are they sharing that growth with shareholders in the form of a growing dividend?

Well, you can probably already guess the answer to that since I just bought shares.

They’ve increased the dividend for the past 12 consecutive years, which is a streak that started not long after former CEO, Bill Gates, stepped down.

Meanwhile, the rate at which the dividend is growing is even more impressive. The 10-year dividend growth rate is a stout 21.8%.

Some of that growth has come at the expense of a rising payout ratio (the dividend has grown about twice as fast as EPS over the last decade), but, at an even 50%, there’s still plenty of room for future dividend raises more or less in line with EPS growth.

The yield right now is 3%, which is obviously pretty attractive. That’s more than 100 basis points higher than the broader market, by the way. It’s also significantly higher than MSFT’s five-year average yield of 2.6%.

I often like to invest in companies with spectacular balance sheets, and MSFT, like recent stock purchase Apple Inc. (AAPL), doesn’t disappoint.

Microsoft is one of only three US companies with a AAA credit rating. Their long-term debt/equity ratio of 0.23 and an interest coverage ratio of north of 47. They have more than $85 billion in cash on the balance sheet. Yes, $85 billion.

Also like AAPL, MSFT’s profitability is through the roof. Their net margin has averaged 27.93% over the last five years, while return on equity averaged 34.47% over that period. Really outstanding numbers here.

Qualitative Aspects

Microsoft has a number of competitive advantages, primarily in the strength of their Windows, Office suite, and server businesses.

I spoke of the strength of an ecosystem when discussing Apple recently, and Microsoft enjoys the same benefit. There’s a stickiness there to using Microsoft’s products, especially as it relates to software. Because their software is designed to work in unison and there’s a learning curve of sorts there, the odds of customers continuing to use their products are somewhat high.

Meanwhile, the enterprise side of the business remains particularly robust due to recurring licensing, switching costs, economies of scale, and their ability to provide multiple solutions. I was a bit concerned as to how the changes in technology in terms of stronger competition and the change to cloud would affect Microsoft and their primary product offerings, but they’ve done well.

What I can see when looking over their financial reports is that while the revenue that Windows generates has declined slightly over the last few years, they’ve more than made up for that with server and cloud revenue. So that indicates they’re not only able to retain clientele as the shift to cloud computing occurs, but they’re also able to scale up Azure fast enough to more than make up for any small losses on the OS side. Meanwhile, Windows has remained surprisingly resilient.

In addition, I love the company’s diversification across products and services. Office is still their largest product by revenue at 28% of the top line (FY 2014), but server products and tools made up approximately 20% of last fiscal year’s revenue. Meanwhile, Windows was just less than 20%. So while Windows is still about 1/5 of the business, the changes there aren’t affecting the company as drastically as one might initially think. And they’re not as reliant on Windows as it would first appear, either.

One really interesting aspect about Microsoft is that they’ve only had three CEOs. Satya Nadella was named CEO of the company in February 2014, taking over from Steve Ballmer. This is perhaps an important – and exciting – shift, as Nadella’s background includes server and cloud computing among his prior duties with his 20+ years with the company, previously heading up MSFT’s Azure business. This could mark a new era for Microsoft, as it continues to focus less on Windows and more on dynamic solutions involving cloud computing.

Lastly, I’ve long been concerned about changes in tech and how that affects some of the entrenched players. However, MSFT’s prodigious free cash flow generation puts them in a fortunate position where they can shift and adapt as they see fit, which gives them additional flexibility and potential growth opportunities on top of organic growth and any developments their internal research & development can provide (they spent $11.4 billion on R&D last fiscal year). For perspective, they generated more than $26 billion in FCF last year – that’s more than three times what PepsiCo, Inc. (PEP) generated their last FY.

If that’s not incredible enough, there’s that $85+ billion in cash on the balance sheet. Obviously, MSFT has to use that cash intelligently. But the flexibility adds value all in itself.

Risks

Like all businesses, MSFT faces risk.

Primarily, I see the company’s competition as a large risk. This competition is fierce across all of their product lines, which means MSFT has to continue developing attractive products and services to stay relevant.

Their track record in some of their product lines isn’t historically great, especially in the smartphone space. Their poor record at developing relatively successful mobile devices could make it difficult to add customers to their ecosystem.

Windows is still a large part of the business and is declining, which could threaten their economic moat by shrinking the customer base within their ecosystem and allowing competition to encroach on their competitive position.

The very nature of their industry is somewhat of a risk. Technology changes rather rapidly, and so they must use their resources carefully in order to maintain growth.

The company also faces acquisition risk, as paying too much for any acquisitions could lead to subpar returns.

Lastly, as a global company, there are currency risks to be concerned with.

Valuation

The stock’s P/E ratio is 16.65 right now. That compares awfully favorably to the broader market, but the five-year average P/E ratio for MSFT’s stock is only 13.5. Clearly, there were better deals available on this stock before, but I don’t necessarily think that indicates the stock is expensive right now. It’s just less cheap than it was before.

I valued shares using a dividend discount model analysis with a 10% discount rate and a 7% long-term dividend growth rate. That appears fair considering their long-term growth across the bottom line and the dividend. Though, the dividend is unlikely to grow much faster than EPS moving forward due to the payout ratio not being as low as it was at the start of the last 10-year period. Nonetheless, robust growth here remains. The DDM analysis gives me a fair value of $44.23.

I think there’s a modest discount to fair value available right now, which is somewhat rare in this market. Getting a high-quality stock with a margin of safety attached to it is always something I’m interested in, especially when I have capital available and space in the portfolio.

Conclusion

Microsoft, perhaps to the surprise of some, is actually adapting quite well to the changes across tech as it diversifies and strengthens its lineup across products and services. Though Windows is slowly shrinking, they’re more than making up for this across their other offerings, namely with server and Office suite products and services. Commercial Cloud is still a small part of Microsoft, but it’s growing rapidly – up 115% year-over-year.

There’s just a lot to like here. The company is growing at a rather strong rate and they’re sharing the wealth with shareholders in the form of an aggressively increasing dividend. Meanwhile, you’re paid 3% to own the shares. FCF not only covers the dividend handsomely, but cash alone could pay the dividend for almost a decade. They’re just incredibly flexible and well capitalized. I see no reason why the dividend won’t continue growing at a suitable rate for the foreseeable future.

This adds to my growing tech exposure, now sitting alongside my positions in AAPL and International Business Machines Corp. (IBM). Although, tech still only makes up a bit more than 2% of my whole portfolio. As I’ve mentioned before, I’d like tech to be somewhere around 2.5% over the long haul. So I’m not too far off now.

This purchase adds $31.00 to my annual dividend income, based on the current $0.31 quarterly dividend.

I’m going to include current valuation opinions from analysts, which I use to concentrate my reasonable valuation estimate:

Morningstar rates MSFT as a 3/5 star value, with a fair value estimate of $46.00.

S&P Capital IQ rates MSFT as a 3/5 star Hold, with a fair value calculation of $47.90.

I’ll update my Freedom Fund in early May to reflect this recent purchase.

Full Disclosure: Long MSFT, AAPL, PEP, and IBM.

What are your thoughts on MSFT? Like the stock? Surprised by the growth and margin? 

Thanks for reading.

Photo Credit: Stuart Miles/FreeDigitalPhotos.net

Note: Affiliate link included. 

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122 Comments

  1. Congratulations on being #1 in the investing section! That’s a great achievement 🙂 and another purchase in a tech company – I suppose Microsoft is relatively secure as they’re such a giant when it comes to their finances. It’ll be interesting to see if both Microsoft and Apple can sustain their share of the market over the next 20 years or so.

  2. You’re awesome dude. Thank you so much for sharing with us. Most charge for their insights.

  3. FF,

    Thank you. It’s really incredible to see book in there with some of the great books on investing/stocks. I’m incredibly fortunate and proud. 🙂

    Cheers!

  4. Nicola,

    Thank you. Just glad to have the book out there in the world. Hopefully, it can inspire a few people.

    MSFT has done surprisingly well over the last decade, and certainly better than I thought they would have. They’ve got some exciting things going on across the business, so I think they’ll continue to do well for a long time to come. Meanwhile, they just produce a ton of cash. The dividend should continue to grow at an attractive rate for the foreseeable future even if the core business slows down. We’ll see!

    Best regards.

  5. Trish,

    Thanks!

    I just really want to educate and inspire as many people as I can. And doing it this way is the best way I know how. I’ve been told by a few people that I should move over to some kind of paid platform, and I’ve even been offered some opportunities there. But I just enjoy sharing what I know with those interested, and I hope people continue to find value in that. 🙂

    Best wishes.

  6. Yowsers,

    Check out Daily Trade Alert tomorrow (www.dailytradealert.com). I actually just wrote a quick piece on WMT. Should go live sometime tomorrow. 🙂

    Take care.

  7. DM,

    Congrats on the book. That is grand achievement. I’ve read a few books off Amazon’s system, the one the comes to mind is Hugh Howey – started publishing through them and has done really well (sci-fi genre). Anyways, I like your purchase of MSFT. I see them them as newer version of IBM, but with a wider palate of industry.

    Congrats, long MSFT,
    – Gremlin

  8. Jason,

    I am surprise with the performance of your book! Well done!

    Regarding your investment in tech stock, you are widening your portfolio which cannot be wrong in the long term.

    Well done, cheers

    RA50

  9. Congrats on the book! Pretty amazing you became the #1 best seller…. I bet you never imagined that 5 years ago when you started!

    With the book selling like hotcakes, I’m sure you’ll be able to squeeze out an extra purchase or two more than you expected this year, pretty awesome stuff!

    I like the MSFT purchase. I added to them right before the last earnings report and the stock sold off. Looks like you are adding right before their next report so may your luck be better than mine! I realize if the price increases, less shares through dividends but I like to see some growth and my picks go up right after a purchase. Its like instant happiness… the dividends though will provide long term happiness and that is what we are all after.

    Congrats again,
    ADD

  10. Congratulations on having the number 1 spot on investing section at Amazon! Didn’t you just release that book already a number 1? 🙂

    I own few MSFT and I am planning to add APPL on my portfolio and most likely concentrate on those 3 including IBM which I already have as my tech plays. QCOM seems attractive too but I dont want to have too much to monitor, 3 would be my tolerance in the tech sector.

    Take care!

  11. Hello from France and congratulations with the book! I’ve been following your blog for a couple of Months now and I must say you deserve the success you are experiencing with the book! Good stuff!

    Microsoft is also on my list. Nevertheless, at this stage I try to concentrate on European stocks 9given the Euro/Dollar parity. What about you, any intentions to take advantage of the ‘cheap’ Euro as compared to the USD?

  12. Hi DM,

    I think MSFT is a great buy right now. I recently doubled my stake it in after it had that massive hit a few months back. I think they’re unpopular right now, but they make solid products and solid profits, and it doesn’t look to me like it’s going to change any time soon.

    Sure, they stink at mobile, but I think commercial cloud and SaaS office and whatever they’re planning with the new windows could be huge.

    I wish I had enough money to add to my stake again, but it’s going to be a while before it works its way back to the top of the list!

    Keep on saving,
    Charles

  13. Any concern about transaction costs when you’re buying $1,000 worth of a stock? Not sure which brokerage you’re using.

    Also, just curious if you subtracted out cash when you calculated the p/e ratio?

  14. Gremlin,

    Thanks so much. It’s just great that people are actually buying it and enjoying it. 🙂

    Glad to be a fellow shareholder there with you in MSFT. Lots to like here. The FCF is just off the charts. And that net margin is nuts. Probably should have picked up shares a while ago, but there’s a time for everything.

    Thanks for dropping by.

    Cheers!

  15. RA50,

    Thank you! It’s doing well thus far. I just hope it’s being enjoyed. 🙂

    MSFT definitely further diversifies the portfolio. The quality is there and so is the growth. We’ll see how it goes, but I think the valuation offers a pretty compelling investment case here.

    Best regards!

  16. ADD,

    Yeah, it’s nuts. I definitely would have never imagined writing a book, let alone seeing it become a best seller. I mean it’s not selling thousands of copies or anything, but it’s just great to have that out there in the world. 🙂

    Yeah, we’ll see what happens after the report. I wouldn’t mind at all seeing it go down. I like to average my way into positions, so a cheaper price would just be a better opportunity for me (assuming the fundamentals aren’t falling off a cliff). I could easily see myself doubling the position in the short term, but I also don’t want to go crazy here. Same with AAPL.

    Thanks for dropping by!

    Best wishes.

  17. FFF,

    Yeah, it looks like it shot to #1 pretty quickly there. It’s all thanks to you readers. 🙂

    I’m with you on the tech plays. I don’t have any immediate plans to expand outside of those same three companies. They all offer a lot to like, though each of them offers a number of differentiating qualities.

    Cheers!

  18. independentbunny,

    Thanks so much. Really appreciate the support and readership!

    As far as European stocks go, I’m not really looking that way. I loaded up on Unilever not too long ago, but it was cheaper then. And quite a few stocks I can think of aren’t particularly cheaper now than they were just a few months ago. There’s always a lot more to consider than just currency concerns. 🙂

    Thanks for dropping in!

    Take care.

  19. Charles,

    “I think they’re unpopular right now…”

    MSFT appears to be chronically unpopular. That’s strange, though, considering the quality and fundamentals. I think they get a bad rap for their consumer facing failures in mobile and search, but the enterprise side of the house is where it’s really at.

    Glad to be a fellow shareholder here. Looking forward to collecting increasing dividend income for many years to come!

    Cheers.

  20. Professor,

    Good question. I actually just opened a new brokerage account, which I’ll be reviewing pretty soon here. Wanted to give it some time to really get familiar with the platform before I review it. But I generally try to keep transaction costs to about 0.5%, which was the case here. Most of my portfolio was built with Scottrade’s platform, so you’ll notice a lot of my purchases were ~$1,400 or so a lot of times. I’ve also received a lot of free trades here and there, which helped as well.

    I didn’t back out cash when I calculated the P/E ratio. But I wrote this article using my price. The price has jumped a bit, causing the P/E to inflate. These articles can only be so evergreen.

    Cheers!

  21. Welcome to the club, actually thinking about adding to my position as a means to average down cost as I’m down “9%”

  22. Congrats with the success of your first book! Thats awesome!

    MSFT is always an interesting play. I think its funny when peopme talk about how the share price has done nothing oover the last 10-15 years but make no mention of the ridiculous valuation at the start or the period or the fact that the company has grown a whole lot.

    Cloud and SAAS will be the next growth opportunity. Xbox should continue to rake in dough. I wish theyd made a lot more progress on the mobile devices but providing back end services with cloud can still be lucrative.

    Nice buy Jason. Im getting an itchy trigger finger so I’ll be looking to make a purchase this month since I havent made one yet. Im seeing a lot more value on either the low or high yield spectrum, but it seems the middle ground is kind of expensive. Looking forward to seeing you put all of that capital from your book to work.

  23. Sunny,

    Happy to be part of the club! 🙂

    The valuation here seems pretty compelling, and my DDM analysis was actually on the light side relative to what M* and S&P Capital IQ came up with. But you’re getting a 3% yield, solid growth, and a lot of opportunity. Hope you get an even better deal if you decide to wait it out.

    Best wishes.

  24. Awesome! I initiated a position in MSFT just 3 days before you initiated your MSFT position! I bought 125 shares @ $ 41.85. Just like you, i liked the strong fundamentals in combination with the relatively low stock price of MSFT. Good we’re fellow shareholders now! Wish you all the best with your book!

  25. JC,

    Thanks, bud. It’s really incredible. I’m fortunate to have a supportive readership.

    But I’ve heard the same thing about MSFT and their stock performance. Can’t complain about something when you simply pay too much. That’s on you. The valuation these days is really quite attractive, though. It’s firmly in value territory, from where I’m standing.

    I also wish they’d do something a bit more robust with mobile, but that’s why I recently bought AAPL. MSFT offers a pretty solid enterprise side, while Apple has a great business for the consumer facing side. All in all, both should do well focusing on their individual strengths. Certainly not a zero-sum game where MSFT’s gains are AAPL’s losses, and vice versa.

    Thanks for dropping by. Happy shopping over there! 🙂

    Best regards.

  26. Amsterdamned,

    Nice! Great minds think alike, huh? 🙂

    I’m with you. Robust growth, strong fundamentals, and a wide economic moat. Not much to dislike here. The fact that they can pay the dividend out of cash for almost a decade is pretty nuts. I think we’ll do well here over the long run, though tech plays require one to keep a slightly closer eye on them.

    Thanks for dropping by!

    Cheers.

  27. Nice pick on MSFT! I just went long on them at the end of March, so I’m glad to hear that one of my role models sees the same kind of value I saw. That monster backlog of cash coupled with their ability to create solid returns with it has me really excited about their future. It helps that I also live just down the street from Microsoft HQ, so seeing the impact and presence of their company is easy around here!

    Keep up all the awesome work. Lots of us are always on the lookout for your next post while setting off on our own road to freedom.

  28. DM,

    First – congrats on your book, knew it would be a hit with 1,000s of people coming to your page per day, just awesome news.

    Second – interesting with the MSFT pick! Great growth on the EPS front and “i guess” great growth on the dividend front, joking – pretty phenomenal when you ask me. Further, I have seen quite a few friends begin switching to surface tablets lately than keeping iPads, so that’s interesting there as well.

    MSFT doesn’t look to be slowing down the dividend growth at all and the P/E ratio currently appears OK. Investments are hard to find given the swings we’ve had lately – big up day for example yesterday and a nice slide today.

    Congrats DM, talk soon!

    -Lanny

    oh and Go CAVS

  29. As everyone mentioned, congrats on the #1 spot with your new book! That’s an awesome accomplishment, especially since you just released it. It shows how much value you are providing for the investing community. And we thank you!

    MSFT looks like they are in the process of reinventing themselves. The one thing I find fascinating is their $85 BILLION cash. They have plenty of money to acquire businesses, protect the dividend, or do so what they please with it. Shoot, They can donate $1 billion to the Running From Debt (<-Joke!) cause and it would only be a trickle in their bucket!!

    Cheers!

  30. Great purchase DM.

    MSFT has been on my watchlist for a while now and looking to add it sometime soon. I would like to see the results this week and see if the company has been able to grow its revenues in other verticals.

    DGJ

  31. Brian,

    Thanks so much. Glad we’re on the same page here. There’s just really a lot to like from the fundamentals to the core business model. The licensing remains strong on the enterprise side, even while computing and tech changes. That’s pretty reassuring. Meanwhile, other areas of the company are growing at a healthy clip. All in all, paints a pretty good picture.

    You must live just outside Seattle. I hear that’s a really beautiful area. Good for you!

    Thanks for all the support. Much appreciated. Doing my best to inspire and create great content. 🙂

    Best regards.

  32. Lanny,

    Thanks, man. It’s been an incredible ride, seeing the blog and community grow over the years… and now a book. I’m really excited to see where things go from here. The community just continues to grow, which is fantastic.

    Glad to hear you like MSFT. The consumer facing side of the house has had some hits and misses, but the enterprise side is really impressive. Office just continues to kill it while cloud is coming up. Can’t wait to see what the next few dividend raises look like. Anything in the low double digits would be wonderful.

    Go Cavs! 🙂

    Cheers.

  33. Ron,

    Thank you. It just really shows that if you do good things in life and help others that good things will in turn come your way. 🙂

    Yeah, MSFT doesn’t have the best record around in terms of using their cash, but I don’t know any business that has a spotless record in that regard. But it still provides the company tons of opportunity and flexibility. And what’s amazing is that even with a few expensive acquisitions over the last decade, the company still has that much cash. Meanwhile, they continue to produce a ton more of it. I’d like to see a special dividend or something of that nature with some of the cash, but only if management doesn’t see a lot of large acquisitions on the horizon that can add more value. We’ll see, but I like our chances at collecting increasing dividend income for the next decade or so.

    Best regards.

  34. DGJ,

    Definitely. It’ll be interesting to see where the company goes over the next year or two. I’ll be watching while I collect. 🙂

    Thanks for dropping by!

    Take care.

  35. DM,
    Congratulations on the sales rankings for the book. That’s very exciting for you to be able to cash in (even more) on all of your hard work that stems from this blog, and to be able to help so many more people. I saw it was ranking in the Motivational category too, not just stocks and investing. Very cool.

    I started buying MSFT back in January when the stock took a beating. Since I’m buying in my no-fee account, I buy $100 here and $100 there, and I’m adding on monthly basis too. I admit, I’ve poked fun at the Zune and the Surface tablet and called them a dinosaur many times, but the numbers and growth don’t lie. I’m actually very eager to buy their next version of Office for the Mac, so I’ll be a customer myself again soon, even though I don’t buy any of their devices. They still dominate enterprise software along with IBM.

    Their credit rating and balance sheet are stellar, but I do miss the days when AAPL and MSFT had zero debt, even though I know it makes more financial sense to borrow with rates being so low. Regardless, I’ll be continuing to build a bigger position.
    -RBD

  36. RBD,

    Thanks, bud. It’s definitely really exciting – not just for the sales aspect, but for the potential to reach people. I’m fortunate to be in that kind of a position. Being able to positively affect people is really amazing. I take it quite seriously.

    That’s a pretty good article there on SA. I agree. I haven’t been particularly interested in PG for quite some time now, which is why I haven’t bought in years. Obviously, we’re not comparing apples to apples, but PG’s valuation doesn’t make sense here given their growth over the last decade. I took a look at the stock about a week ago and concluded it’s just not a good purchase right now. MSFT sports better fundamentals, a higher growth rate, and lower valuation. The odds of PG outpacing MSFT’s dividend growth over the next 5-10 years seems to be low.

    We’ll see how it goes, but I’m with you there on the consumer facing side of the business. Not quite as impressive as the enterprise side, but, fortunately, they don’t need a particularly strong mobile device to do quite well. However, if they were able to figure that out, this company could do much, much better. So there’s a lot of potential there with what seems like limited downside. We’ll see!

    Thanks for stopping by.

    Best wishes.

  37. This is my favorite tech divi stock. Can you even imagine a world without MSFT? Talk about entrenched!

  38. Congrats on the success of your book! And welcome to the MSFT fold! I’m a shareholder too; it’s one of my oldest positions. MSFT is hands-down the best tech company I know of in terms of dividend growth and safety, even better than AAPL (to me at least). For non-techies, I definitely feel MSFT is the perfect stock to get exposure to the sector with, and you’ve done a solid job explaining why. Awesome buy!

  39. DM,

    I just finished the book. It is well worth the money in fact it is probably selling at a discount to the market. 🙂 That’s ok you can always raise the price on the sequels.

    I bought MSFT in the summer of 2013 after an earning miss around $31. I believe it was yielding under 3% at the time. It is amazing how fast the dividend has grown over the past couple of years. My quarterly dividends have increased from about $34 to $46 in the past two years without DRIPing or buying additional shares.

    Great job with the purchase!

    MDP

  40. Nice buy, I am rather surprised that MSFT’s div yield is so high considering the quality of the stock and how so many other tech companies tend to have very low yields. Or very high if they are riskier. Good stuff 🙂

  41. Awesome buy! Welcome to the MSFT club. Warren Buffett once said he would own MSFT but he didn’t want to because of his close friendship with Bill Gates. People would think he had insider information.

  42. financialsubstantial,

    It’s hard to ignore the fundamentals, yield, and dividend growth here. It’s a shame I’ve ignored it for so long, but no more. 🙂

    Cheers!

  43. DD,

    Yeah, I agree. MSFT is easy to wrap your brain around because they have the strong licensing on the enterprise side as well as some of the more visible consumer facing products. And I like that aspect of the company. There are many things about MSFT that I don’t understand for sure, but I can easily see how they make money and how they’ll very likely continue to make money. And that makes me feel comfortable. All in the name of keeping it simple. 🙂

    Thanks for stopping by. Glad to finally be a fellow shareholder!

    Best regards.

  44. MDP,

    Thanks! I’m incredibly glad you enjoyed it. I guess it’s an undervalued asset, huh? 🙂

    MSFT has worked out very well for you. Looks like we’re at a similar level here with the yield near that same spot, except the stock has advanced quite a bit on higher earnings. Looking at the sum of the yield and dividend growth rate, total returns moving forward should remain pretty attractive. That bodes well for us.

    Glad to be a fellow shareholder. Probably won’t go too crazy with tech here other than just adding to AAPL and MSFT opportunistically.

    Thanks again!

    Best wishes.

  45. DW,

    Yeah, the yield here is very attractive, especially considering the quality and dividend growth rate. I don’t know how you could dislike a yield at 3% and dividend growth in the double digits. I passed up MSFT a couple years ago after taking a look at it. I regret that, but the time just wasn’t right. I now have some room for a stock like this as I’ve already built up comfortable positions in a lot of other stocks I like. Plus, the valuations on some of the consumer discretionary/staple stuff is just not in my wheelhouse right now.

    Just another brick in the wall!

    Take care.

  46. YOLO,

    Yeah, I’m fairly certain I remember reading in The Snowball that Gates tried to talk Buffett into buying MSFT stock. But not only was Buffett concerned about any kind of issues there with being friends with Gates, but he also just didn’t really feel comfortable with tech stuff due to the changing nature of the industry. That’s kind of why his big bet on Big Blue a few years back was so surprising. I wouldn’t feel particularly good about making any big bets on any tech companies, but I think placing a few small, well-placed bets with some of the cash cows should allow me to gain exposure, increase my growing dividend income, and limit my risk.

    Cheers!

  47. DM, I also purchased MSFT this month! Good to be a shareholder with you! Congratulations on the book, I’ll be interested to hear (if you are willing) what kind of income you generate with its sales! I’ve always been curious what kind of money I could make by publishing to Kindle!

    All the best!

  48. Any idea why the stock has not performed well since 1999 ? Earnings have grown every year for at least the past 10 years but the stock just never responded until the past couple years.

  49. Patrick,

    Hey, that’s fantastic. Hard to pass up MSFT and some of the Big Tech names right now. Some of these stocks aren’t particularly cheap, offer fantastic fundamentals, great growth profiles, and business models that are very healthy. Not much to really complain about, especially in a market with few other relative values.

    I’ll definitely share info on the book once I collect any royalties. That income will show up in my upcoming income/expense reports, probably starting in June. So I can then share some numbers how it’s working out. 🙂

    Thanks for stopping by!

    Best regards.

  50. Sweettart,

    In a word: valuation. MSFT’s stock was vastly overvalued at the start of that period. There was actually another comment earlier in the thread that pointed out that people seem to ignore valuation when looking at long-term stock performance. This is a good example as to why it’s important not to pay too much. Buying equity a great company (as MSFT was and still is) can be a poor investment if you pay too much, even if the company continues to operate well and grow.

    Cheers!

  51. I used to be a shareholder in MSFT and unfortunately, sold it off way too early. Although I still made a small profit off it, the stock finally broke out within a few months after I sold. The stock was constantly stuck in the 28-32 range when I owned it and eventually, decided to take some profit. In retrospect, not the greatest decision but mistakes happen. My big tech exposure currently is AAPL, so that has been working out great.

    Congrats on the book, Jason. Look forward to reading it soon!

  52. This is more of a generic question. Have you ever figured out your costs in commissions? I know Scottrade collects $7/trade. I’m looking to follow in your footsteps (I read your blog almost every day) But my worry is, when I dollar cost average (making small purchases of the security) I’m worrying about the commissions taking a big chunk out of my bottom line. $7 doesn’t seem like much, but if I make two trades a month, that’s $168. And, sure, that doesn’t sound like much, but, that takes out one whole year of a dividend payment to a decent yielding company. This is why i’ve been looking more into the app Robinhood… Just kind of wondering what your stance is on this?

    -Tyler

  53. Winston,

    At least you had the foresight to buy MSFT in the first place back in the day. 🙂

    Can’t win them all, however. There will always be stocks that got away. So many stocks, so little capital. The good news is that not only have you done well with AAPL over there (and I’m sure many other stocks), but MSFT is available at a pretty solid valuation right now if you wanted to get back in.

    Thanks for dropping by!

    Best regards.

  54. Jason,

    Congratulations on your accomplishments!
    I sent you a note via the Contact page, but not sure if you received it. It was regarding your May plans to Omaha.
    Let me know if you are interested.

    Take care,

    serf

  55. Tyler,

    I kind of already answered this in a comment above. I try to keep my commission costs to 0.5% per transaction, which is reasonable during the accumulation phase (assuming fees will be minimal or nonexistent once one is living off of their dividend income). So that’s generally involved me keeping to about $1,400 per stock buy on average over the course of my investment career. However, I’ve received free trades here and there for surveys and referrals, so I’ve probably averaged even less than that as a percentage.

    But I did just recently sign up with a slightly cheaper brokerage, which is where I purchased MSFT shares. I’ll be reviewing that shortly.

    As far as Robinhood goes, I guess you have to ask yourself if you’re comfortable with thousands of dollars of your money stored with a new brokerage with an unproven business model with virtually no customer service and currently no robust platform. Would I feel comfortable with, say, $50k or $100k of my money there? Probably not. That’s just me. You might come to a different conclusion.

    I will say, however, that if $5 or $7 or whatever is a big concern, then you’re probably not investing enough to offset that. That could then mean you’re not saving enough.

    Hope that helps! 🙂

    Best regards.

  56. serf,

    Thanks so much. Much appreciated! 🙂

    I didn’t receive that note via my email. That’s strange, because I have received about 15 other emails today through the contact form. You’re more than welcome to try again or let me know here what you wanted to discuss.

    Just so you know, I do plan to try to set aside some time probably on Friday for a possible meetup with some readers, depending on how many are interested/available. Just trying to figure out a good, central location. Might make it the hotel meeting area, as I’m staying pretty close to the CenturyLink Center.

    Take care!

  57. Jason,

    Congrats on the success of the book. You really are an inspiration to many. I just opened a position in MSFT myself earlier in the week. I think a little tech exposure is healthy, and you certainly have a large margin of safety with Microsoft. I am currently looking at NOV, BEN, and JPM. Great valuation with NOV, and same with BEN, as well as a shining history.

    Guy

  58. Jason,

    I don’t mind discussing here. I sent a contact note last Friday, the day my BRK credentials came in. I understand you are not a shareholder, and saw you mention you were planning to acquire the credentials in the after market.

    Not sure if you already have something lined up, but I can’t make it this year. I wanted to offer you and Claudia my credentials (2) for free, and would even ship them to you at no cost. Just my way of supporting you, and appreciating what you are doing and honest sharing.

    Take care,

    serf

  59. Guy,

    Thanks so much. Really appreciate the kind words! 🙂

    Glad to be on the same page here regarding MSFT. Just seems like a no-brainer right now, especially in current conditions regarding the broader market. Big Tech seems to offer some of the best value around relative to growth and risk. We’ll see how it goes.

    Best of luck deciding between those stocks over there. Always fun to go stock shopping!

    Cheers.

  60. serf,

    Thanks so much for the offer. Very kind of you!

    I’ve actually already received a couple of passes. I was fortunate in that someone already contacted me a little while ago and offered me a couple of credentials. I received them in the mail very recently and already kind of fondled them a bit. Super excited. 🙂

    It’s a shame you won’t be able to make it, but I know how life can get in the way. This is my first visit and might be my only.

    Cheers!

  61. Wha-a-a-t? Jason buys yet another tech stock? 🙂

    Once again — glad to have you as a fellow stockholder in MSFT! I think its a great buy and I would be a buyer too if I didn’t own shares already. (Buying at this level would raise my cost basis and I’m not quite willing to do that at this point).

    Great job at publishing your first book! Best of luck with the sales — I’m sure readers would find the book as compelling as your blog.

    Take care!

  62. Hey Jason,

    Congratulations on the new purchase! I’m surprised at how well Microsoft has been doing lately – for some reason, I had the impression that their golden days were behind them… I was obviously wrong! A 3% yield with such high dividend growth is surely a winner.

    Thanks for sharing mate.

    DL

  63. Like you I am not a huge fan of tech for a long term dividend portfolio even though there are some stellar names in the sector. I currently own zero tech names and you are just starting to build up your position which is fine as you stated you’d like to keep it a small portion of your portfolio. Nothing wrong with that. Not my fav pick from your list of April stock considerations but I can see why you wanted in. Thanks for sharing.

  64. Completely agree!

    (1) Understand Jason´s intentions concerning a little bit more diversification, a little more action please.

    (2) Tech not my cup of tea – also zero tech stocks in my portfolio – granted they have top margins etc. etc… nevertehless:
    … AAPL (iWatch max 18h battery ..harhar) … MSFT (shrinking PC market und no real mobile punch)

    (3) from Jason´s April “jWatch list” iprefered 😉 and bought ADM and EMR

    Anyway: “Are you sure you want to have more exposure to iTech?” 🙂 🙂 🙂

  65. Congrats on the success of your book and for buying another dividend stock. A stock that has a proven history of rising dividend payments for 12 years running sounds like a decent investment. I cannot wait for payday this month so that I can treat myself to more shares.

  66. Jason,

    Congratulations with your book and its popularity! If I find some time in the future I’ll give it a whirl.

    I believe you did great buying into Microsoft. With the price coming down the past few months I believe the company is offering great value for investors, especially when looking at the broader market. Just like you I’m not too eager on technology (I do not agree with your purchase of Apple, for example), but Microsoft has a big foot in the door where enterprise is considered and I don’t see that happening any time soon.

    With the recent acquisition of Nokia and Windows 10 running on both desktops, tablets and smartphones Microsoft could really shake the market back up. The reason why I haven’t touched my tablet in months is because you can hardly get anything done on it and because there’s no proper productivity applications for it because they’re almost all exclusive to Windows. Smartphones is a different story, but recently the sales of Lumia phones has picked up pace.

    When considering all of this I believe the company will be able to protect its current economic moat and strengthen its market position. Let’s hope you reap the benefits!

    Cheers,
    NMW

  67. Hey Jason,
    Great Job on publishing your first book! I recently found your blog and was so impressed with it I decided to make my own. I just wanted to thank you for the continued dedication and effort you put into your blog. Hope to someday grow a passive income dividend stream like yours.
    Cheers,
    Rich (27)

  68. This has nothing to do with your recent buy.

    Do you ever worry about identity theft since you talk about so much of your finances on your blog? Do you ever worry about being targeted by bad people? I was reading about the Getty family and how one of their heirs was kidnapped and held for ransom, and one of the patriarchs in the family didn’t want to pay it, and well bad things happened. It’s too depressing for me to post the rest. You can google it if you want.

    What if the stock market does very well in the near future and you end up with more than you thought you would like a million dollars or maybe millions of dollars and bad people try to target you? Do you ever worry about things like that? Bad things happen and a lot of people don’t think it will happen to them until it happens to them. So I’m wondering if you’ve got some sort of plan to help your future self?

  69. Welcome to the club! MSFT is one of my longest held stocks as well as one of my largest positions and I consider it one of the cornerstones of my portfolio. They may not be as hip or trendy as something like AAPL (which I also have a small stake in), but I have found the company to be steady, consistent, and reliable. One has to love their near strangle-hold when it comes to business software solutions.

  70. Ferdi,

    Ha! Yeah, I surprised myself a bit this past month. But, at 2% or so of the portfolio, I’m still no tech guru. 🙂

    Thanks for the well wishes there. I really hope it sells well not just for monetary reasons, but because I think it could help to spur a paradigm shift for some people out there.

    Glad to be a fellow shareholder here in MSFT. Let’s hope they continue to keep the pace.

    Best wishes.

  71. DL,

    Yeah, I’m with you. I was also a bit surprised when really running through the numbers. But growth near 10% over the last decade with FCF on par with more than three Pepsis… hard to really pass that up. It checks off pretty much every box for me. Not a huge fan of tech overall, but I don’t see MSFT going anywhere.

    Thanks for dropping by!

    Take care.

  72. DH,

    Yeah, tech isn’t for everyone. And I certainly wasn’t particularly interested in exposing myself much to the sector as I grew out the portfolio. But I’m pretty comfortable with a 2.5% or so weighting there over the long haul. When comparing the fundamentals of some of these companies to, say, a Coca-Cola, it’s not even close. So I think I’ve learned over time to look at that and really try to figure out how these companies work, how they make money, and how they’ll likely continue to make money. And when doing so, I realized that some of these business models aren’t really all that hard to figure out from a high level.

    We’ll see how it goes. 🙂

    Thanks for dropping by!

    Take care.

  73. Laura,

    Thanks so much. It’s great to have a real product out there that people can pick up at any time and enjoy. 🙂

    MSFT has a lot to like here. The fundamentals are pretty much as good as they get across the board. I wish they had a longer dividend growth streak, but I’m willing to bet this is the cusp of something much greater. They’ve matured and transitioned over time, which allows them to return some of that prodigious FCF directly back to shareholders while still having more than enough to grow the business. We’ll see how it goes!

    Cheers.

  74. NMW,

    Thank you. The book is off to a great start, which I’m incredibly proud of.

    I hear you on MSFT. It’s really a different company than people think it is. It’s funny that some companies have this perception around them, but then when you dig into the financials, you find out they’re something totally different. I think the assumption is that MSFT is dying out with slowing PC sales and all that, but it’s just not true. Windows is declining slowly, helped by the fact that enterprise licensing remains strong. Meanwhile, they’re a pretty diversified business both across enterprise and consumer facing products. And I think it’s important to remember that some of their products – like Surface – are really just warming up, so it’ll be interesting to see where they’re at in, say, five years. I’m willing to bet they’ll be making even more money and sharing that with shareholders in the form of a bigger dividend. 🙂

    Thanks for stopping by!

    Best regards.

  75. Rich,

    Glad to hear that the blog inspired you to take some action over there. That’s fantastic!

    I wish you the best of luck with that. I can only hope it turns out as well for you as it has for me. 🙂

    Take care!

  76. Lila,

    Yeah, that’s a good question. Surprisingly (or not), I’ve been asked that a few times now.

    I’m not particularly concerned about it. There are far wealthier people in the world that are far easier to target than me. You can look up information on millionaires and billionaires out there and find out even more about them than me. Besides, I’m probably not even the 100th wealthiest person in my own city.

    From what I understand, Bloomberg used to ride the subway to work. And, from what I remember reading about it, Buffett didn’t even want a security detail. I think his daughter was behind that, and that didn’t start up until he was already a billionaire.

    I think I’ll be okay. 🙂

    Best wishes.

  77. BCS,

    Nice! Thanks for the welcome. Glad to be part of the club. 🙂

    Yeah, MSFT is definitely not trendy. But the good news is that they don’t have to be. They haven’t been trendy for a long time, yet they continue to mint money. I’d rather invest in the most unpopular company in the world if it means I’m going to make a lot of money, rather than something super popular and trendy that doesn’t turn a profit.

    AAPL and MSFT are really just very different companies. Once you start looking through the numbers, you realize that pretty quickly. Nonetheless, I’m glad to own both because they’re both really good at what they do.

    Best wishes!

  78. This is almost exactly what I said in your AAPL discussion. 🙂 MSFT has stumbled on the consumer side, but on the business/enterprise side, if a business isn’t going to use MSFT, what would they use? There is no competitor to MSFT in the business sector, which is good for MSFT. 🙂

  79. Cool, thanks. Any reason you don’t subtract out cash? I’m interested to hear your thought process. I mainly work on private company deals–not much pubco work–but we usually pay for the cash a company has. Totally cool if you can’t respond. Realize you get like a million comments.

  80. adam,

    Exactly. AAPL and MSFT are really different from one another. They excel at different things, and that’s partly why I like owning both. Apple is primarily a mobile device company, whereas MSFT is primarily an enterprise software/licensing company. But it is interesting to note that MSFT is actually more diversified in terms of sales. I like both quite a bit, which is why I’ll probably add to both over the coming months as I build out the positions.

    Best regards!

  81. Professor,

    No problem.

    I don’t subtract out cash because I value a businesses based on the cash flow it can generate from now until forever, discounted back to today. When you use a DCF or DDM analysis, you’re not looking at cash. And that’s because it’s quite possible the cash could be wasted. I like to think of cash as “unlocked value”, because it’s not generating any significant cash flow for the business while it’s sitting on the balance sheet (other than any interest it collects). Thus, it doesn’t really trickle down my way and provide me value. However, it could do just that when it’s put to work, which is why it provides for a lot of potential upside as unlocked value. But all the same it could be wasted on poor acquisitions, which is why I think most models don’t bake that in.

    If you’re buying a company outright, then you’re going to pay for that cash because you’re receiving that unlocked value right away in the form of cash. But if I’m investing in a company that generates zero cash flow, but has $100 billion in cash on the balance sheet, I’m certainly not going to invest as if the company is worth $100 billion. They could very well waste half that money the very next day after I invest. It’s really all about cash flow (either in the form the company generates or how much it provides in terms of dividend cash flow), which is why most models are based on it.

    Hope that helps!

    Best regards.

  82. OK I’m still sending prayers your way. I kind of also thought of blogging publicly on my blog about my progress but I decided against it. I’m too scared. On a more pleasant note, congratulations on your book doing well! I hope it continues to do well. ^_^

  83. Apple was probably my first “trade” turned long term investment. Fortunately they began paying out a dividend shortly after I got in and it’s been gravy since.

    I also got into Microsoft earlier this year just slightly above where you entered. I may not love the idea of tech, but their record suggest I should give them the benefit of the doubt and the fundamentals are solid. The valuation just makes it hard to justify not buying. As I grow as an investor, I’m trying more to be less emotional and more rational. After all, investing shouldn’t be exciting… At least not in a very up and down way.

    Looking forward to the next purchase!

  84. The windows server software business is not going away anytime soon. Many companies prefer to use their software as their system backend because alternatives require a skill set that is not as easily found. Their software tools are also built well (even if server 2012 is windows 8). I believe that many people are just sitting around waiting for Windows 10 to get a new computer. Windows 8(.1)’s reception has been that awful. Their software also has a life cycle that will force people to upgrade over time.

    The only thing I’d like to see them achieve is a larger market share of Windows phones. Owning a Windows phone right now is opening yourself up to getting made fun of.

  85. Ravi,

    Some of my best investments have been the most boring. I’d prefer it that way. 🙂

    MSFT definitely has solid fundamentals across the board. I honestly don’t know what more you’d want. Great yield, great growth, great balance sheet, great profitability, and great track record. We’ll see how it goes, but I like our chances here.

    Best regards!

  86. blahblah903,

    “The only thing I’d like to see them achieve is a larger market share of Windows phones. Owning a Windows phone right now is opening yourself up to getting made fun of.”

    What I like about MSFT is that they don’t even need a big presence in phones to do really well, as we can see here. But if they make some big moves there, that could just be gravy. Then again, that’s why I own Apple. 🙂

    Best wishes!

  87. Ah, okay. I see. That makes sense. I’d probably factor cash into my model somewhat (unless you really, really distrust management), but I definitely see where you’re coming from. I mainly deal with investments in private companies for 5 – 7 year periods, so it’s good to read about the pubco side. Thanks!

  88. First off, I would like to say thank you for being such an inspiration to beginner dividend growth investors like myself
    Secondly, congratulations on the book and the purchase of another high quality dividend paying stock!
    I also agree MSFT is pretty attractive fundamentally, and was happy for an opportunity to pick up some shares while it is sporting a yield well above the five-year average 🙂

    Have a great day!

  89. Divi Hunter,

    No problem at all! I’m happy to hopefully help and inspire. 🙂

    MSFT is incredibly solid across the board. It’s perhaps surprising because the media would have you believe otherwise, but numbers don’t lie. Just another reason to ignore the noise.

    Thanks for dropping by!

    Best regards.

  90. Wow Jason!!!! Congrats on the early success of the book, that’s terrific!

    MSFT is a fine choice to just hold and (nearly) forget. So much cash, such a dominate position, and if they ever spin out XBOX or BING (money losers, I believe) they will certainly show even more upside in their earnings power. I think the name is good for mid to high single digit growth from here.

  91. Brian,

    Thanks so much. It’s off to a really great start. I’m proud. 🙂

    I agree. MSFT is a company that you really don’t have to think about much, which is both surprising and comforting for a tech play. A lot of their revenue is fairly recurring and things just don’t change too much for them. Like AAPL, they’ve got a great ecosystem going on over there and they’ve shown a lot of resiliency. Happy to be a shareholder!

    Thanks for dropping by.

    Cheers.

  92. Hi DM,

    Nice buy. I don’t have any tech stocks in my portfolio. The only company I have with some tech exposure is the Belgian holding Sofina. It has paid dividend since 1907 and it has raised its dividend every year since 1956. So it is a company I really like.

    Oh an congrats with the book! I will probably buy it when I have read my latest books. Bookstores are a dangerous place for me.

    Cheers,
    G

  93. Geblin,

    Ha! I hear you there on bookstores. I walk in one and end up not walking out for hours. 🙂

    I haven’t heard of Sofina before. Sounds like it’s working out for you, though. Awesome!

    Thanks for stopping by.

    Cheers!

  94. Jason! Congrats on the book. I was very certain that you would do amazingly well!

    Great job and solid buy of MSFT considering its recent volatility.

    Cheers!

    BeSmartRich

  95. Hi Jason. Well, MSFT is soaring today more than 9% just after presenting Q1 results. I got 140 shares at 40,56$ last february, righ atfer its yield got into 3% territory:

    http://bit.ly/1N5Qrba

    MSFT Q1 results: Revenue up 6%, EPS down 10% mainly due to strong dollar. Azure cloud doing very well. MSFT is transforming itself into a services company and less dependent on selling software licenses.

    http://www.microsoft.com/Investor/EarningsAndFinancials/Earnings/PressReleaseAndWebcast/FY15/Q3/default.aspx

  96. BSR,

    Thanks so much. It’s really off to a great start. The more copies it sells, the more people are reading it and hopefully finding value in it. I’m just glad to be in a position to inspire others. 🙂

    MSFT is turning out well thus far. Looking forward to seeing how they do over the next few years, though.

    Thanks for dropping by!

    Best regards.

  97. jguerrero71,

    Yeah, I’m glad I was able to initiate a position before it popped. I know some were waiting until after earnings on the hope that it would dip. But that just goes to show why you can’t/shouldn’t time the market. Buy high quality when the price is attractive. The rest is noise. Time in the market matters more than timing the market. 🙂

    I was actually kind of hoping for the opposite move, which would give me an opportunity to average down. Looks like MSFT is probably off the radar for now.

    Cheers!

  98. DGJ,

    Yeah, you just can’t time the market. Some people were recommending waiting until after earnings because the stock oftentimes takes a beating after the announcement, but that just goes to show why you shouldn’t do that. Buy a great stock when the price is right. Time in the market will likely lead to a lot more success than timing the market.

    Although, I wish it would have went the other way. Would have given me some food for thought for my May purchases. It’s now pretty much off the table. But that’s okay. Other opportunities are out there. 🙂

    Best regards.

  99. Jim,

    Total luck. But I’ll take it. 🙂

    I actually wouldn’t have minded the stock going the other way on me, as I always love an opportunity to average down. But I’m glad I got in before the pop occurred. I’ve been in a situation before where I was circling a stock like a vulture circles roadkill, and just before buying – bam! – the stock pops and leaves me in the dust. Glad that didn’t happen this time.

    Best wishes!

  100. Love the fact that this is only one of three companies with a AAA credit rating. The company sure is looking a lot better under Satya Nadella – although I find some of their business moves very intriguing lately. Im sure they have chosen a path after careful thought and will be watching closely.

    Also noticed that the stock price shot up last couple of days…nice little bump there for you.

    Best wishes
    R2R

  101. R2R,

    Nadella definitely seems to be moving them in the right direction. They’re relying less and less on Windows, which I like.

    I’m glad I got in before the pop, but I would have been happy to see the stock stay where it was. I’m interested in adding to the position, but probably not after that. Fortunately, there are plenty more stocks out there. 🙂

    Thanks for dropping by!

    Best regards.

  102. Nice buy, Jason!

    Should provide another cashcow to your solid portfolio.

    I bought my first Diageo shares today. Looking forward to years of profitable compounding and dividends for us both.

    Kind regards

    Jarmo

  103. Jarmo,

    Diageo is a great company. Hope to join you at some point. Really fantastic brands over there. 🙂

    Sounds like we both picked up some cash cows recently!

    Thanks for stopping by.

    Cheers.

  104. That’s why its good to have multiple stocks on the radar at any given time. There are a few stocks I’m currently tracking. Having multiple options allows me to benefit when a good entry point highlights itself.

  105. JayP,

    Indeed. I’m usually looking at at least five or so stocks at any one time, sometimes upward of 10+. It’s great to have options. It’s a market of stocks, after all. 🙂

    Cheers!

  106. DM, I built a very full position in MSFT from the beginning of 2011 thru the end of 2012 in 8, 100 share lots, each time MSFT dipped below 27, the lots were priced from 24 to 27, my average cost being 25. It was tough as sentiment was so very negative during this entire time. I now have 884 w reinvested dividends. I would buy again if I ever thought MSFT offered as much value as it did back when I was accumulating. It’s like JNJ for you.

  107. DD,

    That’s fantastic. It’s so hard to go against the crowd, but it’s also incredibly rewarding when done correctly. You’ve witnessed that firsthand.

    I wish I would have bought MSFT back in the day, but I’ve done well with the other moves I’ve made. Either way, I’m very happy to be a shareholder here. It appears that they’re entering an entirely new phase, which is really exciting. I as hoping to get an opportunity to add to my position pretty quickly, but that price really popped. We’ll see. I’d be happy to double or triple MSFT if the right opportunity came along.

    Cheers!

  108. It is hard and lonely but like you say, can be incredibly rewarding. I did exactly the same thing w CSCO and INTC those same years, 2011 and 2012. More recently over last year(s)have been accumulating RDS.B, BP, GSK, TUP, IBM and some others when they fall especially low and everyone is totally negative on these names.

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