Last week at the World Economic Forum in Davos, Switzerland, Bill Gates in an interview with CNBC mentioned that Google and Apple were good competitors. Here is the link to that interesting part of the conversation:
http://www.cnbc.com/id/15840232?video=629449301
http://www.cnbc.com/id/15840232?video=629449301
The appealing thing to note is that when asked about Google, Bill Gates very confidently mentioned, "We are going to challenge them and surprise them." He also said that Microsoft is working on several good ideas. This could present an intriguing situation. Yahoo! (YHOO) is coming out with its earnings reports today and I will be really surprised if they beat the street's expectations. Yahoo! has unfortunately lost it's mojo. It still may be a good company thanks to its talent. It's very experienced in the field of search engine, web-based e-mail and other services they offer. If YHOO reports "not satisfactory" earnings today, it's stock is going for a free-fall. This might be a golden opportunity for Microsoft. Microsoft is one of the best companies in the world with a huge market share and tons of cash. If they want to, they can very easily buy Yahoo out and perhaps that is what Bill Gates was insinuating? Based on what he said, I initiated an equity position in Microsoft (bought MSFT stocks) and bought YHOO calls last week. If Yahoo does drop after earnings today, I will add more YHOO calls.
If a rumor of Microsoft trying to buy Yahoo starts, there will be a huge upwards spike in the price of Yahoo. If Microsoft does actually make an offer, I will close my Yahoo positions.
This should actually not affect Google in any way. Google is in a league of it's own and no potential merger between any companies in the near future can affect Google's prospects. I have been long Google for a very long time and continue holding and adding to my existing position.
As for Apple, Apple is way beyond Microsoft or anyone's league. It's led by a visionary who has no parallel. I will always be long Apple and constantly be adding more Apple as long as Steve Jobs is at the helm. The iPhone is just a start. Just watch what he is capable of.
As for Apple, Apple is way beyond Microsoft or anyone's league. It's led by a visionary who has no parallel. I will always be long Apple and constantly be adding more Apple as long as Steve Jobs is at the helm. The iPhone is just a start. Just watch what he is capable of.
2 comments:
I have to think that YHOO longs have to be frustrated and if they don't issue excellent guidance for 2008 we should see a drop here.
That indeed was a great prediction. Nice read. Keep up the good work.
- Mike
Post a Comment