The Zacks Analyst Blog Highlights: Microsoft, Google, Yahoo, Facebook and Monsanto

Zacks

For Immediate Release

Chicago, IL – August 10, 2012 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Microsoft Corporation (MSFT), Google (GOOG), Yahoo (YHOO), Facebook (FB) and Monsanto Company (MON).

 

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Here are highlights from Thursday’s Analyst Blog:

 

Microsoft Launches New Email

 

Microsoft Corporation (MSFT) announced that it has launched a new e-mail service called Outlook.com. The new service will replace the existing Hotmail service.

Microsoft has been struggling with its Hotmail brand and e-mail related software service with its Microsoft Outlook brand. This was because Microsoft faced intense challenges from Google's (GOOG) Gmail and Yahoo's (YHOO) Yahoo Mail.

Hotmail, founded by Sabeer Bhatia and Jack Smith, was launched in July 1996. Microsoft purchased it in 1997 for $400 million and renamed it MSN Hotmail.

While Gmail users totaled 425 million worldwide and Yahoo 310 million.  Hotmail has picked up 369 million users since its inception. Over time, Hotmail has lost share to both Gmail and Yahoo mail.

To regain its lost market share, Microsoft is trying to increase the relevance of its email service. Outlook.com is therefore cloud-based, with user information stored on Microsoft servers and enabling users to check their mails, contact lists and other data across multiple devices. While this is not original, it does bring Outlook on par with the others.

It is believed that Microsoft will not be scanning user emails to target relevant advertisements. However, it is early yet and we should not forget that Microsoft is trying its utmost to promote Bing. Google, on the other hand, is facing heat regarding privacy matters related to Gmail.

The new e-mail service managed to generate lots of excitement among techies, with the first million users signing up within hours of launch. Microsoft is trying to build on this momentum and hoping to reach the one billion mark.

Microsoft intends to infuse an element of fun into the service by collaborating with Facebook (FB) -- and soon with Skype and Twitter -- and narrowing the gap between social data and emails. This strategy could help bring back a few customers that they lost earlier to Google and Yahoo.

Microsoft is one of the largest software companies in the world. The company’s operating systems are installed on the majority of computers anywhere in the world. The company has been innovating on many fronts and has many new and exciting products lined up.  

For the fourth quarter of fiscal 2012 ended in June, Microsoft reported revenue excluding deferrals of $18.05 billion, which was up 3.7% sequentially and 4.0% from last year, exceeding estimates by 0.4%. All except the Windows segment contributed to the increase in the last quarter, although Server & Tools and Entertainment & Devices were particularly strong.

Currently, Microsoft Corporation has a Zacks Rank of #3, which implies a Hold recommendation in the short-term (1-3 months).

 

Monsanto Increases Dividend

 

Monsanto Company (MON) recently announced a 25% increase in its quarterly dividend to 37.5 cents per share from the prior payout of 30 cents a share. 

 

The increased dividend will be paid on October 26, 2012 to shareholders of record as of October 5, 2012. 

 

Monsanto continues to take steps to increase shareholder value through share repurchases and dividends, thereby making use of excess cash as well.  The company also announced that it will repurchase shares worth $1 billion over the next three years.

 

Earlier, the company offered debt worth $500 million. Management intends to use the cash proceeds for general corporate purposes and to refinance an existing debt of $486 million with maturity due on August 15, 2012.

 

The company also issued senior unsecured notes worth $500 million in two equal parts. The first lot consists of $250 million aggregate principal amount of 2.2% senior notes maturing July 15, 2022. Yield to maturity on these notes is 2.213% and have been offered at 99.884% to the public. Interest will be paid semi-annually on these beginning January 15, 2013.

 

The second lot comprises another $250 million aggregate principal amount of 3.6% senior notes, scheduled to mature on July 15, 2042. These notes will yield 3.608% on maturity and have been offered at 99.854%. Interest will be paid semi-annually on these beginning January 15, 2013.

 

 

 

 

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