Microsoft Corporation (MSFT) & Old Tech: Where To Invest In The Current Market Scenario – Mark Yusko

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Technology based companies like Microsoft Corporation (NASDAQ:MSFT) always remain a good bet on the Street and many analysts and pundits would agree with this. But not all tech companies stay on top of their game all the time: only very few do. At any point in time, depending on the market scenario at that time, some tech companies would do beyond everyone’s expectations and guessing that right is a completely unimaginable talent that only few possess. Mark Yusko, CEO of Morgan Creek Capital Management, is one such talented person. He talked on Fox Business regarding the tech companies that people can trust in current market scenario.

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Yusko thinks that the technology sector is where all the growth is and for that reason he loves tech companies. He said that he loves semiconductor companies like Micron Technology, Inc. (NASDAQ:MU) and old technology companies like Microsoft Corporation (NASDAQ:MSFT) and Intel Inc (NASDAQ:INTC). He explained:

“What we really really like in technology is Chinese Internet. What’s going on in China in terms of the consumer shift from fixed asset investment to consumer driven economy is going to be extraordinary and there are companies like VIPShops which is, think of T J Maxx online without stores: much higher margins, much higher growth and T J Maxx is a $40 billion company. This company VIPShops has gone from nothing to $10 billion and could be much, much bigger.”

Yusko also talked on prospects of Alibaba. He said that they own some Alibaba shares and are eagerly waiting for them to go public in September. He feels the Alibaba would come to public roughly between $130 billion to $ 150 billion and he expects that it would increase to $200 billion to $210 billion after the first trade, which is staggering. He said that Alibaba could make $8 billion in profits in the coming year.

He thinks that Alibaba dominates every market that they enter. They contribute to 80% of the entire Chinese transaction. He pointed out at an example in which they had raised $80 billion in 8 days in the money market.

Meanwhile, he touched on Microsoft Corporation (NASDAQ:MSFT) doing a lot of job cuts recently. This, he said, raised doubt on the early days of new CEO Satya Nadella. Yusko said that based on Microsoft’s performance in the market, the new CEO has done really well. He thinks that companies like Microsoft has to evolve as the situation changes and job cuts may be necessary in some situations. He thinks that the 20-30 age group is the highly creative group and Microsoft will be taking them on with the business shifts.

Investors call many of tech company stock as volatile. Yusko said that some of them may be volatile since they set the benchmark in tech that their company is working on. He pointed out that if a tech company stock goes up by 10% every quarter, they are always hitting new highs and there is no need for people to worry that this might not continue.

 

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