I like Jim
Cramer and I regularly watch his Mad Money television program. I also
occasionally listen to his much calmer radio show Real Money via a pod cast. In
general, I think he knows more about stocks then just about anyone and I have
made some money in the market following his advice over the past year or so.However, he has take a recent stand that I'm not sure is correct.
He is down
on Microsoft, Dell and Intel on the assumption that the personal computer
market will continue to be sluggish for the next year or so. His take on Intel
may be correct because AMD has certainly achieved significant advances in
market share at the expense of the once untouchable giant. And Dell is getting
competition from discount Asian manufacturers, which forces their margins down
to painful levels, so he may be right to take a bearish stand there. However, Iam not sure about Microsoft.
stock price took a nose dive after announcing the delay in Vista and following
that up with a poorly performing quarter, but I wonder if that is just a lull
before a corporate buying spree? In a recent article in PC Magazine they should
a graph and report by Jon Peddie Research that showed
the percentage of PCs in active use that are fully Vista compatible. Theirconclusion was that only 51% of PCs in active use will be able to run Vista.
So we get
the usual question: Will corporations buy new machines to run Vista or will
they sit tight and stick with Windows XP? It is the same question we asked eight
months before Windows XP and Windows 2000 and Windows 95. It is the perpetual
question. Each time the answer has been yes they will buy new PCs --- only it
won't really happen in the form of a spree. Corporations spread capital
expenditures out over the two years or so following the release of a newWindows operating system.
difference this time, and the thing that worries Microsoft and the Wall Street
brokers, is whether that cycle will repeat itself this time. Windows Vista is
going to have to have a compelling story I think. So far, I have seen some nice
visual enhancements and some nice features that make Vista a viable operating
system. I don't think Vista will fall flat like Windows ME. However, from a
corporate purchase decision standpoint, I have yet to see what Vista brings tothe table beyond Windows XP that will make corporations buy it.
missing something. Over the next year, TechRepublic will examine Vista sideways
and backwards to provide the membership with a comprehensive critique of Vista,
perhaps then I will see a reason to buy Vista. If reasons surface, I think
Microsoft will sell lots of Vista licenses, earn lots of money, and continue to
be the dominate player in software. If they don't, it could mark a turningpoint in the history of the personal computer.
What do you
think? Have you found a compelling reason to buy Vista? Are you buying
Microsoft stock or looking to dump it. Personally, I sold my Microsoft stock inJanuary 2006.