Microsoft Kisses 200-day Moving Average Ahead of Earnings (MSFT)

Microsoft Corp. (NASDAQ: MSFT) is set to report earnings after the close Thursday, and First call has estimates at $0.44 EPS on $14.5 Billion in revenues.

The software giant is also expected to post $0.48 EPS and $15.56 Billion in revenues next quarter, which also marks its June-2008 fiscal year end.  For fiscal June-2009, estimates are $.10 EPS on $66.5 Billion in revenues.

Based upon what we saw out of Q1 PC shipments last week, and based on comments out of IBM, Intel, and other key technology stocks, we expect the earnings to be a very strong report.

Shares closed at $31.45 today, and the reason these aren’t at $35.00 or higher is because of the potential Yahoo! (NASDAQ: YHOO) acquisition share dilution.  Investors are going to be looking at this Yahoo! merger commentary quite closely.

Analysts are still positive and the average target from analysts is almost $39.00.  Its 52-week trading range is $26.87 to $37.50.

We do want to note the levels will be different tomorrow, but the stock is at critical levels that should act as pivot points.  Its 50-day simple moving average is $28.61 and its 200-day simple moving average is $30.71.  With a gain of almost 4% and a $31.45 close today, that new 200-day moving average in the morning is going to be very important at earnings.

We’ll follow up with an updated information round ahead of the report tomorrow.

Jon C. Ogg
April 23, 2008