We presently own Microsoft (MSFT) in the TDI Managed Growth Strategy, even as most techies poke fun of the slow moving and sometimes conservative company. With a war chest of cash (approaching $70 billion after the recent debt offering) they are ready to take on any company that treads on its turf, with Google (GOOG) being the main target of their recent aggression. The idea that Microsoft buying Yahoo! (YHOO) may or not move ahead, but either way they are determined to tackle the search engine market share.
If you have not heard, the latest addition to this category is called BING.
There are several companies that track search and below is a more detailed view of the latest information from marketshare.com. They have yet to update their statistics to include Bing, but what is interesting is that they do not have anywhere near the same percentages for Microsoft as Comscore does. I assume that they have a smaller universe of search providers.
Even so, it is clear that Microsoft is moving higher, even if it is slowly. It will take a great deal to topple the mighty Google, but it appears that if anyone can….
Bing Off to a Good Start in First Week of Search Activity, According to comScore
Microsoft Posts Gains in U.S. Searcher Penetration and Share of Search Results Pages After Introduction of New Search Engine
RESTON, VA, June 9, 2009 – comScore, Inc. (NASDAQ: SCOR), a leader in measuring the digital world, today released a preliminary study of the performance of Bing, Microsoft’s new search engine, during the first week of its public launch. The results of the analysis show a substantial improvement in Microsoft’s position in the search market in the days following Bing’s introduction.
If investors decide to apply a tech P/E to Microsoft, it could become a real growth story. (P/E now ~ 12.5)
Microsoft Sites increased its average daily penetration among U.S. searchers from 13.8 percent during the period of May 26-30 to 15.5 percent during the period of June 2-6, 2009, an indication that the search engine is reaching more people than before. Microsoft’s share of search result pages in the U.S., a proxy for overall search intensity, increased from 9.1 percent to 11.1 percent during the same time frame.
Microsoft Sites Search Performance
6/2/09-6/6/09 vs. 5/26/09-5/30/09
Total U.S. – Home/Work/University Locations
Source: comScore qSearch
5/26/09-5/30/09 6/2/09-6/6/09 Point Change Searcher Penetration (Avg. Daily) 13.8% 15.5% 1.7 Share of Search Results Pages 9.1% 11.1% 2.0
“These initial data suggest that Microsoft Bing has generated early interest, resulting in a spike in search engagement and an immediate term improvement to Microsoft’s position in the search market,” said Mike Hurt, comScore senior vice president. “So far it appears that the lifts in searcher penetration and engagement have held relatively steady throughout the five-day period. The ultimate performance of Bing depends on the extent to which it generates more trial through its extensive launch campaign and whether it retains those trial users. It appears it is off to a good start.”
The stock still seems to have a great deal of room on the upside as we see the new Xbox gaming system having a bright future. Fundamentals are sound and even as Apple, Google and the rest of the tech universe continues to attack, Microsoft has a good team with great depth.