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Is Microsoft (MSFT) A Smart Long-Term Buy?

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Vulcan Value Partners, an investment management firm, published its “Vulcan Value Partners Focus Fund” fourth quarter 2021 investor letter – a copy of which can be downloaded here. Vulcan’s Focus Composite Fund delivered a 7.3% net return for the fourth quarter of 2021, compared to its benchmarks, the Russell 1000 Value Index and S&P 500 Index which delivered 7.8% and 11.0% returns respectively for the same period. Spare some time to check the fund’s top 5 holdings to have a clue about their top bets for 2022.

Vulcan Value Partners Focus Fund, in its Q4 2021 investor letter, mentioned Microsoft Corporation (NASDAQ:MSFT) and discussed its stance on the firm. Founded in 1975, Microsoft Corporation (NASDAQ:MSFT) is a Redmond, Washington-based multinational technology conglomerate holding company with a $2.2 trillion market capitalization, and is currently spearheaded by its CEO, Satya Nadella. Microsoft Corporation (NASDAQ:MSFT) delivered a -9.58% return since the beginning of the year, while its 12-month returns are up by 30.89%. The stock closed at $304.10 per share on March 24, 2022.

Here is what Vulcan Value Partners Focus Fund has to say about Microsoft Corporation (NASDAQ:MSFT) in its Q4 2021 investor letter:

"Microsoft Corp. was a material contributor during the quarter. It is one of the highest quality companies in the world. We believe it has tremendous competitive advantages in its consumer and commercial Microsoft Office products as well as in its server and tools and Azure divisions. Over the last several years, Microsoft has been implementing a successful transition from a traditional software license and maintenance revenue model to a subscription revenue model. The company remains competitively entrenched, produces strong free cash flow, and has a strong balance sheet."

LinkedIn, Microsoft
LinkedIn, Microsoft

Photo by Alexander Shatov on Unsplash

Our calculations show that Microsoft Corporation (NASDAQ:MSFT) ranks 2nd on our list of the 30 Most Popular Stocks Among Hedge Funds. Microsoft Corporation (NASDAQ:MSFT) was in 262 hedge fund portfolios at the end of the fourth quarter of 2021, compared to 250 funds in the previous quarter. Microsoft Corporation (NASDAQ:MSFT) delivered a -9.14% return in the past 3 months.

In March 2022, we also shared another hedge fund’s views on Microsoft Corporation (NASDAQ:MSFT) in another article. You can find other letters from hedge funds and prominent investors on our hedge fund investor letters 2021 Q4 page.

Disclosure: None. This article is originally published at Insider Monkey.