As watchers and fans of CNBC’s Jim Cramer, we often agree with his fundamental perspective, but we understand that he is more infotainment than financial advisor. When have to wonder from a fundamental perspective what his rationale was on two specific calls. On Tuesday’s Mad Money, two different callers asked him for his take on Microsoft (MSFT) right now. His responses follow,
“There isn’t almost anything that Microsoft can do to move. I’m not going to recommend Microsoft on this show other than the fact that it happens to be a stock and I think that all stocks are going up now because we’re in an uptrend…
Microsoft. I can’t get excited about I just think it’s kind of dead in the water. You know I could go up with the rest of the market. It’s just not exciting enough.”
It seems that Cramer’s main complaint for Microsoft is that it is not sexy and likely doesn’t have a major catalyst to propel price appreciation. Again, we understand that he makes countless calls each week day, but from a fundamental perspective Microsoft looks pretty sexy. The company has zero debt, and more than $20 billion in cash on hand. That alone is enough to separate it from the pack, but there is more. For a mature business they are still growing revenue impressively at over 10% annually in the last 5 years. They may be losing market share to competitors Apple and Linux but growth in worldwide computing is more than enough to over come this. In fact, we like Microsoft’s fundamentals so much that we highlighted it in Microsoft: A Ben Graham Stock. 
It seems to us, here at Ockham, that Cramer is yet another investor who overlooks Microsoft because there is not enough cache. However, Microsoft has all the hallmarks of being Greatly Undervalued and will see nice appreciation over the next year or two. For information on all other stocks mentioned by Cramer, see the chart to the right.
What’s Cramer Got Against Microsoft?
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