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Three massive names rule today's technology sector. From iMacs to iPads, Apple's (Nasdaq: AAPL ) iEmpire seems to roll out one hot product after another. Mighty Microsoft (Nasdaq: MSFT ) still owns desktop computing and has begun aggressive initiatives to conquer the cloud and master mobile devices. Omnipresent Google (Nasdaq: GOOG ) rules Internet search and advertising, and guns for both Apple and Microsoft with its online apps and Android mobile OS. But which of these giants will earn investors the best return by the middle of the decade?
On The Motley Fool's Twitter feed, Foolish follower @ParitoshMohan recently asked: "Which out of GOOG, AAPL, MSFT is the best growth investment from a 2-3 year perspective?" We put that question to three of our best investing minds, and asked for their takes on which tech luminary will shine brightest in the years ahead.
An embarrassment of riches
Anders Bylund, Fool contributor.
For me, it's hard to beat the combination of business growth and stock value that Google delivers. Among this trio of tech titans, Google stands alone:
- Apple is certainly a growth stock, but too risky for my taste. This stock is fine as long as absolutely everything goes according to the grand plan of Steve Jobs, but Murphy's law will surely intervene at some point.
- Microsoft's stock is cheap, but this is a dinosaur searching for direction, and failing more than it succeeds. Here, you're looking for a turnaround of epic proportions -- one that may never happen under current management.
And then there was Google. The undisputed search leader is quickly becoming a mobile leader, too. It's only just getting its feet wet in offline ventures like TV advertising and clean energy. And we often don't even know what Big G's next big thing is until it hits us over the head.
Google's growth story is not finished, but the market treats the stock like a fully mature no-growth paper. Act accordingly.
Meet the true king of all media
Tim Beyers, Fool contributor and Motley Fool Rule Breakers analyst.
When this question first came, I was poised to pick Google. Why? The search king is undervalued, and is spreading its software to all corners of the world, thanks to the success of its Android mobile operating system, which recently has been outselling Apple's iOS device platform.
But I just can't do it. As much as I believe Google will come to dominate computing over the next 20 years, I think Apple is the better buy over the next two to three years, thanks largely to a shift in content distribution models.
The iPad has changed everything. It's the one device capable of aggregating media from many different sources. From streaming movies to newspapers to e-books, virtually every content distributor is seeking space on iOS devices. This, Fool, is one of the reasons why the iPhone and iPad already account for $30 billion in annual sales, or close to half the $65.2 billion in revenue Apple booked in fiscal 2010.
Clearly, we were all too conservative in estimating the effect of the iPad and Apple's other iOS devices. I won't make that same mistake twice. Neither should you.
Why Joe goes with Goo
Joe Magyer, lead analyst, Motley Fool Inside Value
Poor ol' Microsoft can't get no respect. Sure, it'll probably never make a serious dent in mobile, and its core Windows and Office franchises have futures with all the excitement of power lines. The shares are awfully cheap, though, swapping hands at only 11 times earnings. Plus, you've got to give Microsoft and its 2.4%-yielding dividend some credit compared to cash hoarders Google and Apple.
But that Microsoft apologist pitch aside, Google is my horse in this race, thanks to the underrated durability of its search franchise, the success of Android in the fast-growing mobile market, a host of other irons in the fire, and its $31 billion in cash. Little wonder I tabbed it as a buy a few months back at Inside Value.
You ask, we'll answer!
Thanks to @ParitoshMohan, and to all our Foolish followers on Twitter. If you've got a burning question about money or stocks, we'd like to help! Tweet us @TheMotleyFool or leave a comment below; the best questions could become the subject of future Fool articles.
Eager for more great tech stock ideas? Come back to Fool.com at 11 a.m. ET tomorrow, when we'll unveil our picks for the Top 5 Tech Stocks for 2011.