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Will Microsoft’s stock price go up or down?
Will Microsoft's stock price go up or down?
The Enormous Microsoft market cap (just north of 1.78 USD trillion) and the abundance of its stock, even at $238.95 each, make it very attractive for the speculators to play with it. They do this by structuring deals to buy or sell its calls and or puts (or the stock itself), and two or three days before any earnings release, as volatility grows, it is possible for them to extract profits.
As an example, in the recent quarter (q3) of Microsoft, while sales and earnings vastly missed expectations, the stock rose more than 4%.
It is very likely that the deal was structured, but it is also very probable that the gains were real. The reason is that the lack of growth in this quarter, was due to a one-time charge in the PC segment of the company, which was affected by the end of the XP cycle in April, and therefore its sales of this segment declined considerably.
Between the 2nd and 3rd quarters, sales of the Consumer segment increased by 3% (which was widely expected); however, in the 4th quarter, as XP sales declined, it is possible that there will be a decline in Fiscal Year (2015) sales in the Consumer segment. In this case, it is possible that the company will have to pay a dividend in the near term in order to maintain its stock price.
