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Microsoft Announces $40 Billion Buyback and 3.4 Percent Dividend

  +Follow September 17, 2013 10:32AM
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Facing pressure to return money to shareholders, on Sept 17 Microsoft Corporation (MSFT) revealed a plan to buy back $40 billion in shares and start doling out a $0.28 dividend, constituting a 3.4 percent return. While there is no timeline on the buyback, the dividend – which topped analyst estimates of a dividend increased by 2 cents – will be the second largest among tech companies worth over $100 million, only slightly less than the 3.8 percent paid by Intel Corporation (INTC) .

In June the company first began revealing that a massive change in strategy would be taking place when they unveiled their restructuring as “One Microsoft” as a response to criticism the company was fractured and inter-competitive, and as a result had incubated a toxic corporate culture that stifled innovation.  

Fears the company was stagnating were confirmed on July 18, when the company issued an incredibly disappointing second quarter 2013 earnings report. The report, which included a $900 million writedown on the failure of the Surface RT tablet, caused a 15 percent two-day plunge in the stock that the company still hasn’t fully recouped.

Following the stock plunge, Microsoft has scrambled to try to placate shareholders and retool the company. First came a change in leadership. On Aug 23 much-derided CEO Steve Ballmer revealed he would be stepping down within a year, causing a 6 percent stock spike.

On Sept 3 they announced the purchase of Nokia Corporation (NOK) , making clear their intention to make a play in smartphones, a market in which they have badly lagged.

Now with the buyback and increased dividend, Microsoft is attempting to appeal directly to the pocketbooks of disgruntled long-term investors. Microsoft’s stock is only up 30.37 percent from five years ago compared to a 53 percent gain for the S&P 500. The company is worth 60 percent of what it was in Dec. 1999, when it hit an all-time high of $58.35.

Microsoft edged up on the news of the dividend and buyback, gaining .73 percent to hit $33.04 a share.

 

(image of Microsoft Store courtesy of WIkimedia Commons)

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions.


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Results for MSFT
XS
30 Sep 14 22:08:32
Wait, so it goes from Windows 8.2 to 9, and now 10? Get your shit together $MSFT. But can't be any worse than the PR disaster with Xbox One.
ANSWER PLUS
30 Sep 14 22:08:05
Bill Gates Keeps Top Spot as Richest American http://t.co/NKS3M318Ql via @daily_finance $BRK-A $BRK-B $MSFT
Stock Moo
30 Sep 14 21:48:56
$msft: Microsoft's New MSN Hits The Web Running, Windows Sold Separately http://t.co/5Qh9zzvHdU
Stock Moo
30 Sep 14 21:48:56
$msft: The Name Windows 10 Makes As Much Sense As Windows 8 Did http://t.co/BkBSdbsvnC
Stockbuyer2014
30 Sep 14 21:41:31
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Consestimate
30 Sep 14 21:13:54
The Most Important Promised Feature Of Windows 10 Could Pay Off Big For Microsoft. $MSFT. http://t.co/XLKlYQPiP4
Alfred L. Antrum
30 Sep 14 21:01:40
Microsoft unveils Windows 10, tries to woo enterprises http://t.co/tEJPx3Ns8Y $MSFT/#@AAntrum
FinancePress
30 Sep 14 20:56:24
$MSFT Microsoft Corporation (NASDAQ:MSFT) Reveals its Latest Operating System ...: Microsoft Corporation (NAS... http://t.co/1CLw0PqxV2
Jake Hamby
30 Sep 14 20:54:53
.@AseDeliri if you want to get real old school, one thing $MSFT fixed in the knock-off of CP/M that became MS-DOS was renaming PIP to COPY.
Bidness Etc
30 Sep 14 20:30:22
Microsoft has revealed adoption rates for its Windows 8.1 and Windows Phone 8.1 operating systems http://t.co/vD8VvqAiX8 $MSFT
Justin Burleigh
30 Sep 14 20:27:29
OMG! Just watch from the beginning to 5:00. Then short all your $MSFT and never hire their PR firm.https://t.co/DXIbDprM29
Neth Wiedemann
30 Sep 14 20:23:53
$AAPL is revolutionizing mobile & the most exciting $MSFT news is that they may remove the start button from 'Windows 10'. #timeshavechanged
Henry@Abundance
30 Sep 14 20:20:16
EBay PayPal Spinoff Elevates Mobile Wallet Fight http://t.co/qFwKCNQydz #IBDNews via @IBDinvestors $EBAY $GOOGL $AMZN $BABA $MSFT
BUZZ Just-In
30 Sep 14 20:09:14
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Howard Chu
30 Sep 14 20:07:11
$AAPL is about to release Mac OS X Yosemite 10.10... so $MSFT calls their next as Windows 10 https://t.co/LTq8DR0EMc
Major Pharma Feed
30 Sep 14 20:00:54
Ireland Exporters Look To Thursday's ECB Policy Vote $googl $msft $jnj $act $jazz $shpg http://t.co/AF2BEnlybS http://t.co/qIoflswYsU
Tech Industry Feed
30 Sep 14 20:00:54
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Darcon
30 Sep 14 19:41:11
RT @Roadmap2Retire: $MSFT next version is called Windows 10 instead of 9. Reminds me of this. https://t.co/MnYS2DQqIl
Stockaholics
30 Sep 14 19:38:38
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Evan
30 Sep 14 19:37:48
RT @Roadmap2Retire: $MSFT next version is called Windows 10 instead of 9. Reminds me of this. https://t.co/MnYS2DQqIl
Roadmap2Retire
30 Sep 14 19:35:52
$MSFT next version is called Windows 10 instead of 9. Reminds me of this. https://t.co/MnYS2DQqIl
Larry Trutter
30 Sep 14 19:28:57
RT @DanielEran: Apparently $MSFT skipped Windows 9 to avoid a backlash in Germany #jawohl
FinancePress
30 Sep 14 19:19:27
$MSFT Microsoft Corporation Announces Windows 10 (MSFT): Microsoft Corporation Announces Windows 10 (MSFT) Di... http://t.co/6aR2zPqeiI
Patrick Seitz
30 Sep 14 19:18:47
Microsoft says 'nein' to Windows 9, skips right to 10. http://t.co/UUGWlgvaqB $MSFT http://t.co/MUQQmu7J7U
Chris Erice
30 Sep 14 19:13:58
Windows 7 ate 9. 😅 $MSFT #Windows10 http://t.co/bTi3ZXssKQ
lizwaite
30 Sep 14 19:13:04
Engadget Daily: Windows 10, the $200 laptop you've been waiting for, and more! http://t.co/roNIrf5sh4 $MSFT aiming for the low bar
Elizabeth Toy
30 Sep 14 18:54:04
RT @JeffMacke: 7 ate 9. RT "@carletonenglish: "Where's 9? Microsoft unveils Windows 10" http://t.co/kDbg86k8TH via @cnbc $MSFT”
M A J Szymanski
30 Sep 14 18:49:20
$MSFT - Microsoft desvela el futuro de Windows http://t.co/o1OlrbjNWC
john smith
30 Sep 14 18:49:15
$MSFT - Microsoft desvela el futuro de Windows http://t.co/sGxMN3YNsT
Live Stock News
30 Sep 14 18:49:07
$MSFT - Microsoft desvela el futuro de Windows http://t.co/ZSq6LY01ce
matt collom
30 Sep 14 18:49:05
$MSFT - Microsoft desvela el futuro de Windows http://t.co/uqStobizcr
NASDAQ
30 Sep 14 18:49:03
$MSFT - Microsoft desvela el futuro de Windows http://t.co/NzLhB0v7Ki
Stock Moo
30 Sep 14 18:48:54
$msft: [$$] Microsoft Offers First Peek of Windows 10 http://t.co/QKAHxBMIXh
S↕♏✪n™
30 Sep 14 18:40:15
$MSFT #Microsoft offers first peek of Windows 10 http://t.co/UA0mpj5tnB via @WSJ
[ Microsoft News ]
30 Sep 14 18:34:33
Mojang owner Markus Persson joins a @twitter chorus mocking @microsoft's Windows 10 ... https://t.co/Q9YW7TlfNr $msft http://t.co/vzUB5G8L2X
Michael R. Greco Sr.
30 Sep 14 18:08:35
Blog Entry: Announcing Windows 10-http://t.co/JUpU1Y0neH #Windows10 #Win10 #MicrosoftWindows10 #Microsoft #MS #MSWindows10 #MSWindows $MSFT
Minecraft Retweet
30 Sep 14 18:05:35
RT @TheStreet: $MSFT's purchase of Minecraft gives it a strategic opportunity no one is talking about: digital game distribution http://t.c…
Bidness Etc
30 Sep 14 18:00:31
Microsoft will open local data centers in India to push the company’s cloud services in the region http://t.co/7lt6OXjhRN $MSFT
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30 Sep 14 17:48:54
$msft: [$$] Microsoft Offers First Peek of Windows 10 http://t.co/rjg9kKfGzJ
Royce Williams
30 Sep 14 17:47:54
RT @TheStreet: $MSFT's purchase of Minecraft gives it a strategic opportunity no one is talking about: digital game distribution http://t.c…
Rajan Soni
30 Sep 14 17:34:53
RT @TheStreet: $MSFT's purchase of Minecraft gives it a strategic opportunity no one is talking about: digital game distribution http://t.c…
Anthony
30 Sep 14 17:32:01
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TheStreet
30 Sep 14 17:29:07
$MSFT's purchase of Minecraft gives it a strategic opportunity no one is talking about: digital game distribution http://t.co/ya4Uie4dm1
Stock Wire
30 Sep 14 17:15:07
4 charged with hacking Apache simulator software, $100M of Microsoft data $MSFT http://t.co/grzTrMJDJM
Chris Marriott
30 Sep 14 17:13:39
Windows 10 is funny. In order for $MSFT to make a relevant OS, it has to bring back features abandoned 5 years ago. http://t.co/Tg7Blv0n6u
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30 Sep 14 17:09:05
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Douglas Crets
30 Sep 14 17:07:33
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30 Sep 14 17:06:09
RT @barronstechblog: Tech Today: eBay Splits It, Debating Apple, Facebook’s Occulus - Tech Trader Daily - $AAPL $FB $EBAY $MSFT $ARMH http:…
ashy
30 Sep 14 17:05:43
RT @WSJ: Microsoft to unveil the next version of Windows: http://t.co/SnotyZ6Ddr $MSFT http://t.co/CrMFJekHaP
Douglas Crets
30 Sep 14 17:04:18
"@howardlindzon: "@OphirGottlieb: Rumor has it @businessinsider will be publishing an article on $MSFT tom Preview: http://t.co/05wp1EIVyR"
				
				
  +Follow September 17, 2013 10:32AM
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