{"id":33160,"date":"2012-10-26T11:11:24","date_gmt":"2012-10-26T15:11:24","guid":{"rendered":"http:\/\/countingpips.com\/forex-news\/2012\/10\/in-a-war-of-attrition-microsoft-will-beat-apple\/"},"modified":"2012-10-26T11:11:24","modified_gmt":"2012-10-26T15:11:24","slug":"in-a-war-of-attrition-microsoft-will-beat-apple","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex-news\/2012\/10\/26\/in-a-war-of-attrition-microsoft-will-beat-apple\/","title":{"rendered":"In a War of Attrition, Microsoft Will Beat Apple"},"content":{"rendered":"

By The Sizemore Letter<\/a><\/p>\n

Apple ($<\/span>AAPL<\/a>)<\/strong> is getting most of the attention this morning due to its earnings release late yesterday.\u00a0 Two weeks ago, I asked \u201cIs it time to dump Apple<\/a>,\u201d and I think the answer is increasingly \u201cyes.\u201d\u00a0 Though the company remains wildly profitable, earnings missed estimates this quarter, and there is a sneaking realization that Apple\u2019s competitors are catching up.<\/p>\n

But today, it\u2019s not Apple I want to talk about.\u00a0 It\u2019s Apple\u2019s erstwhile PC rival Microsoft ($<\/span>MSFT<\/a>).\u00a0 <\/strong><\/p>\n

Microsoft was the undisputed winner of the PC era, but the company hasn\u2019t quite found its way in the era of Web 2.0 and social media.\u00a0 The smartphone war is down to two main combatants in software\u2014Apple and Google ($<\/span>GOOG<\/a>)\u2014<\/strong>and two in hardware\u2014Apple again and Samsung. \u00a0And despite coming out with a tablet years<\/em> before anyone else, Microsoft has been left behind on this front as well.<\/p>\n

Things are about to change.\u00a0 With the long-awaited release of Windows 8, Microsoft is making a real push into the world of touchscreens and tablets.<\/p>\n

Apple launched the first offensive in the smartphone and tablet wars, but in a long-term war of attrition it is doomed to lose for the same reasons that it lost the original PC war.\u00a0 Apple has always maintained a closed ecosystem and insists on making its own hardware and<\/em> software.\u00a0 Steve Jobs\u2019 pigheadedness is the reason why it was the Wintel platform and not the Mac that came to dominate the desktop and laptop markets.<\/p>\n

It\u2019s all happening again.\u00a0 Apple again jumped out to a huge lead, but it will lose the war in the end.<\/p>\n

And what about Google?\u00a0 I like Google and I personally use an Android phone.\u00a0 But I believe that in a long war it is Microsoft that will win.\u00a0\u00a0 I question whether Google really takes Android seriously.\u00a0 It\u2019s a free product that generates revenues only indirectly by encouraging mobile web browsing via Google\u2019s search engine.\u00a0 Meanwhile, Microsoft knows how to manage corporate clients, and corporate IT departments are comfortable with Microsoft products to a degree that they will never be with Google or Apple.<\/p>\n

As a value investor, I often get into trades too early. Not matter how I might try to game myself to avoid this, it seems to be hardwired into my DNA as an investor.\u00a0 So it\u2019s entirely possible that I am early this time as well.<\/p>\n

That\u2019s ok.\u00a0 If Microsoft takes longer than I expect to rise to the top, we still get to collect its 3.3% dividend and benefit from owning one of the cheapest major blue chip stocks in the world.<\/p>\n

Microsoft is a buy.<\/p>\n

This article first appeared on\u00a0TraderPlanet<\/a>.<\/em><\/p>\n

Disclosures: Sizemore Capital is long MSFT.\u00a0 Get Sizemore Insights\u00a0delivered to your e-mail<\/a>\u00a0FREE.<\/strong><\/p>\n

The post In a War of Attrition, Microsoft Will Beat Apple<\/a> appeared first on Sizemore Insights<\/a>.<\/p>\n

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