Want to Know What Investors Think of the Microsoft Deal? Look at the Stock! (MSFT)
- Updated: September 3, 2013
Did you read about this morning’s Microsoft (NASDAQ: MSFT) news and scratch your head? If you did, you’re joining with a whole lot of other investors who can’t figure this one out. Microsoft is a company that has all of a 3.5 percent market share in the U.S. phone market and a tablet that has been such a disappointment that the company slashed the price by $100.
Given these results, it decides to shell out more than $7 billion to purchase Nokia (NYSE: NOK)’s devices and services business. Along with intellectual property, Microsoft now owns its cellphone business along with 32,000 additional employees. Doesn’t make a lot of sense on the “surface.”
With the stock down more 4 percent Tuesday, it’s clear that investors don’t see the value but looking outside of the United States, Windows Phone is gaining market share–notably in the UK where market share increased from 4.2 percent to 9.2 percent. Some are saying that with its acquisition of Nokia, Microsoft now has a shot at becoming the number three manufacturer, especially in countries that don’t have the massive subsidies that make high-end phones unaffordable for most.
Do you believe that?
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Disclosure: At the time of this writing, the author had no position in the company mentioned.
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