Mar 15, 2017|
Rodney Nelson (Morningstar, MSFT) by The Financial Exchange
Transcript - Not for consumer use. Robot overlords only. Will not be accurate.
It is time now for stock talk here in the financial exchange and joining us from Morningstar is broadly Nelson. Who's gonna talk to us about Microsoft. Symbol MS FT and robbing Microsoft of old tech company that's actually done a pretty good job transition into the new era. Have a good morning and then that that's clear Microsoft has done a pre tremendous talent last couple of years of transitioning its business away from legacy businesses like windows. Out becoming obvious to all known for and I know the guys mentioned earlier that they've made some questions black edition. In the past. And Lincoln is certainly one of those that. That comes on the radar when looking at large and the spent 26 billion dollar some Linkedin but we actually think that is aligned much better with the new Microsoft. Than acquisitions like Nokia are wanted did last several years. So what Lincoln definitely want more clout visit the Microsoft is pushing forward in the expect the heavy integration of public office. Microsoft that you're moving forward. Yet a Nokia deal what Ken was an attempt that we saw they missed the boat on the Smartphones and they did that they tried to go for a home run and it was clearly a loser they've written off. But what about that linked an acquisition we had trouble putting our arms around. The reasons why this makes a lot of sense for Microsoft I know the doing great. In the cloud is that is that again where you see this explained to me what widely linked in makes Microsoft the better company. Sure sought basic obvious the purchase price looks expensive but when you look when you think about the app that that Microsoft actually required. They're number he's cases that can be derived from going in database that. Develop from 400 million active users on the on the platform. Creepy about Microsoft business they have to compete in productivity suite of offices the most widely used business productivity suite the world they're never use cases the can be derived from Linkedin in that particular software applications for example you can source professional data from people within your own enterprise. To find the right person organization for new project. In terms of hiring you can you can source you applicant's new candidates for particular role that you've been looking itself some time many of you expand on the bottom Microsoft portfolio they compete and salesforce automation and this is a reason why Kabila Salesforce.com was selected and Linkedin. I want when it went up on the block. They'll force automation is becoming increasingly intelligent but I mean by that is good. Killed people are looking for ways to score their lead that they can track down the most likely needs to close first well Lincoln allowed. You do it toward the right person in the organization you're going to approach to make sure you have the most productive and high level conversation. With the decision maker written an organization that's incredibly valuable to a sales person. Microsoft compete with still Salesforce.com and that they'll force automation. Market though that it is incredibly valuable enter in. In terms of generating leads course for that particular product and that ultimately short sales cycle for salespeople. I and we can get better better quotas and in higher revenues obviously. All good stuff and I guess it's hard for us to be able to relate to a company of this size at a 26 billion dollar acquisition to achieve what you just explained. Actually make sense. Read and I expecting didn't know the headline number obvious he makes people. Toward Mickey Owen comparable or you think about the eyes of Microsoft told the 500 billion dollar Mike market cap company to taking it point six billion dollar acquisition of against the side of the potter company it's still not that big of but an impact in the potter business that even if you go back in time and look at the Nokia acquired acquisitions but a large acquisitions they are multibillion dollar acquisitions but again Microsoft hasn't. The capital. And the strong to hit strong. Strong competitive position business. Is that they can afford to make that like this and that you have to go wrong like Nokia like equality and they can afford to digest that and continue to move forward now I I do you think that those acquisitions in particular didn't align with the bread and butter Microsoft quote business. I think since they've installed new management. Thought Angela taking over for Steve Ballmer. We've seen a much clearer direction towards mobile and towards the cloud and I think when did it in to both those profiles. But it should be much easier to integrate not only his days as a standalone product that also added to existing products as well. And the secret sauce the funding a lot of this in addition to obviously cash award is the fact they've got a legacy business that is an actually cash cow in honestly. Windows is hung around as a cash cow a lot longer and a lot of us thought would happen. It has its its been revitalized by it by a couple of factors so it particular resurgence in in some of the higher and laptops that are being purchased their being. Driven by windows and I'll get into the more successful than than most prognosticators would've predicted one when Microsoft first announced the. It was going to leave out some. We've got to Ctrl+Alt+Del here right stay with us for a lot more still to come thanks long Ruddy Nelson you're listening to the financial exchange from the insurer match dot com studios.