Barron’s upbeat on Microsoft, wary on telcos

NEW YORK, Jan 31 (BestGrowthStock) – A columnist for financial
weekly Barron’s reiterated his bullish view on technology names
like Microsoft Corp (MSFT.O: ), but was cautious on the
telecommunications sector.

Technology columnist Eric Savitz said in the Feb. 1 edition
of Barron’s that Microsoft shares, which rose after strong
quarterly results on Thursday, could head even higher with the
help of the company’s repurchase plan. They closed on Friday at
$28.18.

“While Microsoft shares have doubled off their 2009 low, to
the high 20s, plenty of upside remains,” he said, adding that
he was also positive about Intel Corp (INTC.O: ) and Seagate
Technology (STX.O: ) shares.

Savitz was more cautious about the mobile phone makers and
carriers, however, citing weaker-than-expected iPhone sales in
Apple Inc (Read more about Apple stock future.)’s (AAPL.O: ) otherwise strong quarterly results. He
also noted disappointing results from Motorola Inc (MOT.N: ).

New, cheaper data plans by wireless carriers AT&T Inc (T.N: )
and Verizon Wireless, owned by Verizon Communications Inc
(VZ.N: ) and Vodafone Group Plc (VOD.L: ), suggested pricing
pressure ahead, he said.

“So, AT&T and Verizon could be headed for a price war that
will produce more customers, but also higher capital investment
and thinner margins,” he said. “Both stocks have appealing
dividends, but I see trouble ahead.”

He also cited the risk of a time bomb for AT&T shareholders
since the company is expected to lose its exclusive deal to
sell the iPhone.

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(Editing by Martin Golan)

Barron’s upbeat on Microsoft, wary on telcos