What Separates Microsoft Stock from Apple Stock?

MSFT StockMossberg Gives a Window into MSFT Stock

A man called Walt Mossberg retired this year. Don’t worry if that name means nothing to you, because Mossberg isn’t a household name. He is, or rather was, one of the best technology writers around. (First for The Wall Street Journal and later for his own news startup Recode).

Mossberg gained tremendous influence throughout the years. You could find him sitting across from the biggest names in Silicon Valley, including Bill Gates and Steve Jobs. Naturally that gave him an insider’s look at Microsoft stock and Apple stock.

Now that he’s retired, he has shared a few stories about his personal relationships with these iconic billionaires. One of them is incredibly telling.

The year was 1997. Apple Inc. (NASDAQ:AAPL) was teetering on the verge of bankruptcy. Everyone donned black suits for the funeral. And Mossberg’s editor asked him to write an obituary. An obituary for Apple.

In the article, Mossberg did much more than mourn Apple. He wrote that although Bill Gates was the “most important businessman since WWII,” Steve Jobs was the true innovator.

He implied that Jobs took bolder leaps when it came to technology. Gates did not like this assessment at all. He called up Mossberg in a rage, yelling, “What the hell do you mean I’m just a businessman?”

Mossberg told this story in a recent interview. Some people think it’s a quirky anecdote and nothing more, but I think it reveals a crucial aspect of Microsoft Corporation (NASDAQ:MSFT). Namely, that Microsoft is a boring, brilliant, everlasting business.

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Microsoft Stock Price History
Beta 1.40
52-Week Change 32.68%
S&P 500 52-Week Change 15.68%
Shares Outstanding 7.72B
Float 7.55M
50-Day Moving Average 69.93
200-Day Moving Average 66.19

How Microsoft Found Itself

This gap between Apple and Microsoft is especially important now that Jobs and Gates are no longer in the picture. Tim Cook has done a remarkable job of keeping Apple on track, but he hasn’t been able to squash the competition like Jobs did. If he had, Samsung would not be the bona fide threat to iPhones.

Microsoft, on the other hand, lost its way when Gates handed over the reins to Steve Ballmer. It became a standing joke in the tech world, famous for being three years late to every trend.

Rather than making the sound business decisions that had turned Microsoft into a corporate juggernaut, Ballmer tried to imitate the Steve Jobs-esque leaps that capture media attention.

For instance, Ballmer orchestrated the takeover of Nokia’s cellular division. Why? So he could create a line of smartphones to compete with the iPhone. It was a disastrous acquisition, and for more than just Microsoft’s bottom line. It killed the company’s reputation.

When Ballmer’s tenure ended in 2014, Microsoft was considered an endangered species. Satya Nadella brought it back to life. After taking over the company from Ballmer, Nadella refocused Microsoft on enterprise sales, cloud computing, and activities that are essential to institutions.

That is what Microsoft was built on: pure business. Get the big client, the corporation with deep pockets. Forget the average consumer and how they spend their money. It’s not in Microsoft’s DNA to go after those consumers, and Nadella seems to recognize that.

His stewardship put MSFT stock back in the winner’s circle.

So, even if it bothers Bill Gates that Microsoft was never as “cool” as Apple, he should take comfort in the knowledge that MSFT stock is untouchable when it stays in its lane. So long as the CEO of Microsoft understands what makes this company great, I will maintain my bullish outlook on this company.