Microsoft (NASDAQ:MSFT) is a selection for the real-money Inflation-Protected Income Growth portfolio. In this brief video, portfolio manager Chuck Saletta offers three reasons he's holding on to Microsoft's stock despite the 39% rise since he bought those shares a little more than a year ago.
Summary:
- Reasonable valuation, with a market cap in line with a fair-value estimate.
- Healthy balance sheet, with a debt-to-equity ratio of around 0.3 and a "AAA" debt rating.
- Covered and growing dividend with a 36% payout ratio and an emerging trend of dividend hikes.
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