Microsoft Corporation (MSFT) Goes Under the Sea with Data Centers Aimed at Improving Latency


Microsoft Corporation (NASDAQ:MSFT) is one of those companies who is always trying to break away from the trend by setting trends of their own. While there have been many companies experimenting with locating data centers in various places around the globe, Microsoft has a new idea of their own — an idea that they have successfully been testing for over a year now.

Called ‘Project Natick’, Microsoft is testing the use of data centers under the sea. That’s right, data centers that are beneath the surface of the Pacific Ocean. While one might question the advantage of such submarine servers, common sense predicts the benefits. First of all, the ocean is quite an effective way of both generating electricity, and cool the servers. With its cold waters and relatively rough surface, it might just be the most environmentally efficient way of running a data center. On top of this, about 50 percent of people live wihtin 200 kilometers of the ocean, thus putting data centers about 1 kilometer from the coast can help reduce latency to those living by the coastline.

All of this is still in the experimentation phase of development, but so far tests have proven quite sufficient. It will be interesting to follow this and see how it develops. If it proves to be both affordable and efficient, this might be the start of something new, not just for Microsoft but for other companies such as the Googles and Apples of the world as well.

Shares of Microsoft Corporation (NASDAQ:MSFT) are down 0.93% in the pre-market this morning. The stock increased 5.83% or $3.03 during the last trading session, hitting $55.09. About 18,010 shares traded hands. MSFT has risen 20.68% since June 25, 2015 and is uptrending. It has outperformed the S&P500 by 30.89%.

From a total of 18 analysts covering Microsoft Corporation (NASDAQ:MSFT) stock, 14 rate it a “Buy”, 1 a “Sell”, and 3 a “Hold”. This means that 78% of the ratings are positive. The highest target price is $66 while the lowest target price is $20. The mean of all analyst targets is $54.87 which is -0.40% below today’s ($55.09) stock price. Microsoft Corporation was the topic of 36 analyst reports since July 22, 2015 according to the firm StockzIntelligence Inc. Morgan Stanley upgraded shares on January 13 to a “Overweight” rating. Vetr upgraded shares to a”Strong-Buy” rating and a $47.60 target share price in their report from a September 2. Barclays Capital maintained MSFT stock in a recent report from January 6 with a “Overweight” rating. Global Equities Research maintained the rating on August 28. Global Equities Research has a “Overweight” rating and a $50 price target on shares. Finally, Goldman Sachs upgraded the stock to a “Neutral” rating in a report they issued on a December 18.

The institutional sentiment increased to 1.08 in Q2 2015. It’s up 0.32, from 0.76 in 2015Q2. The ratio increased, as 69 funds sold all their Microsoft Corporation shares they owned while 801 reduced their positions. 93 funds bought stakes while 843 increased their total positions. Institutions now own 5.20 billion shares which is 8.27% less than the previous share count of 5.67 billion in 2015Q2.

Cook & Bynum Capital Management Llc holds 25.5% of its total portfolio in Microsoft Corporation, equating to 717,081 shares. Rwwm Inc. owns 895,414 shares representing 19.69% of their total US portfolio. Moreover, Valueact Holdings L.P. has 19.37% of their total portfolio invested in the company, equating to 75.27 million shares. The California-based Smithwood Advisers L.P. has a total of 17.28% of their portfolio invested in the stock. Deccan Value Investors L.P., a Connecticut-based fund reported 2.26 million shares owned.

Microsoft Corporation is engaged in developing, licensing and supporting a range of software services and products. The company has a market cap of $435.72 billion. The Firm also creates and sells hardware, and delivers online advertising to the customers. It has 39.23 P/E ratio. The Firm operates in five divisions: Devices and Consumer Licensing, D&C Hardware, D&C Other, Commercial Licensing, and Commercial Other.