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Hang on. Stock market price is suppose to price in future earnings too. So, the price is always to some extend speculative and may look quite divorced from pres
by hangonhn 8y ago
Hang on. Stock market price is suppose to price in future earnings too. So, the price is always to some extend speculative and may look quite divorced from present circumstances. So, if during the Balmer era the price was depressed, it reflects the negative predicted outcome for Microsoft and if it is a bit lofty, it reflects expectations of better days to come for MSFT.
- scarface74 8y agoWell it is suppose to be the current value of all future earnings. But the stock market isn’t usually rational. But like the old saying goes: “The stock market can stay irrational a lot longer than you can stay solvent.” There was nothing on the radar between 2000-2007 that even hinted at Microsoft remaining dominant.
- sonnyblarney 7y agoFuture earnings are difficult to predict, so they factor in the warm fuzzy things that the CEO talks about, and how much 'confidence' they have in them. Also - times change. In the 2000's people just thought MS was 'old'. Now they are realizing there's some life in the beast. Satya deserves a lot of credit, nothing bad to say - but in hindsight it also seems as if MSFT was under priced.