WSJ.com - Heard on the Street: Value Investors Flock to Microsoft

WSJ.com - Heard on the Street: Value Investors Flock to Microsoft "Since the what-have-you-done-for-me-lately "growth" investors have given up on Microsoft Corp., the bargain-hunting "value" crowd has been gobbling up its shares.
For years, Microsoft was a growth powerhouse as its Windows operating system and Office software suite became ubiquitous, running on about nine of 10 personal computers world-wide. From 1996 through 2002, Microsoft's profits nearly quadrupled, and its shares rose more than 450%.
Since then, the software company's pace has moderated as its Windows and Office updates have grown increasingly time-consuming and complex. In an Oct. 30 memo, Microsoft Chairman Bill Gates laid out plans to retool how the mammoth firm develops products -- to fend off competitors, such as Google Inc., that are using the Internet to develop and distribute software.
But growth investors, who focus on shares of companies whose profits are increasing by leaps and bounds, have grown frustrated. Microsoft's widely held shares have lost 13% of their value during the past five years.
As the company's shares have slipped, however, value managers have warmed to them."

Strange days indeed.