Microsoft Corp. (MSFT)

<b>Microsoft Corp.</b> (<a href=http://www.zacks.com/stock/quote/msft>MSFT</a>) is one of the largest software companies in the world. The company&#39;s operating systems are installed on nearly all computers anywhere in the world. Therefore, the recovery in the PC market is encouraging. <p> The huge core business, management&#39;s acquisition strategy and cost reduction initiatives are driving strong cash flows and earnings growth. While we recognize that competition continues to increase and the company&#39;s dominant position in the PC market could erode, we note that attach rates of the new OS are increasing. <p> We believe that Microsoft is poised to benefit from new product cycles in both the enterprise PC and server markets. Hence, we are upgrading MSFT shares to Outperform.

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