The Zacks Analyst Blog Highlights: Yahoo, Intel, Microsoft, Google and Facebook

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Jul 23, 2013, 09:30 ET

CHICAGO, July 23, 2013 /PRNewswire/ -- Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include Yahoo (Nasdaq:YHOO-Free Report), Intel (Nasdaq:INTC-Free Report), Microsoft (Nasdaq:MSFT-Free Report), Google (Nasdaq:GOOG-Free Report) and Facebook (Nasdaq:FB-Free Report).

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Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

Here are highlights from Monday's Analyst Blog:

Technology Stock Roundup: Companies Struggle, Paradigms Shift

Earnings season for the technology sector has kicked off. If last week was any indication, the sector is going to have one of its worst seasons ever.

What's Irking Big Tech this Earnings Season?

Last week saw Yahoo (Nasdaq:YHOO-Free Report), Intel (Nasdaq:INTC-Free Report), Microsoft (Nasdaq:MSFT-Free Report) and Google (Nasdaq:GOOG-Free Report) report earnings. While none of the companies' core businesses met expectations, Yahoo's Asian assets saved it. The ongoing move to mobile platforms has impacted these companies in different ways.

Intel's core technology is selling into a shrinking PC market and the company is scrambling to get new chips and hardware partners that could strengthen its position in mobile. Intel has an uphill battle since designs from others are tried and tested. However, Intel has had a product in the works for some time and the company continues the fastest move to superior process technology and sufficient capacity. Under the circumstances, its capex reduction appears more sensible than significant. Intel's moves are those of a company with a plan, but only time (probably Q4) will tell how successful that plan is.

Microsoft, on the other hand, looks in bad shape. This is not because it hasn't prepared for the transition to mobile, but more because it is repeatedly failing to feel the pulse of the public so it can sell some really great products. The company is now under pressure from certain shareholders to change its strategy and move away from devices to the cloud.

Microsoft's PC business is disappearing rapidly, its position in mobile is practically non-existent and its popular gaming platform is seeing challenges. The only areas that continue to strengthen are its cloud and business solutions. If the company doesn't get its act together, it could see trouble here too.

Google has problems of its own but the company also has vision. It started out as the leading search engine on the desktop platform and went on to become the leading search engine in the mobile segment as well. It's true that pricing issues are bleeding the company at present, but the cure is also on the way.

Google's "Enhanced Campaigns" will bring back spenders and Google will continue to diversify. There's a concern that its legal problems will accelerate but it has many irons in the fire so the impact on shareholders could be less.

For Yahoo and Facebook (Nasdaq:FB-Free Report), it's all about engagement. These companies are striving to get users to choose their web properties and stay on them for as long as possible.

Yahoo continues to revamp, redesign and re-invest and the company has reported that its new designs and technology are increasing engagement. It has promised to be a "mobile first" company but its efforts are yet to move the needle in terms of revenue and profits. Facebook has already reported success in the first quarter (users up 30% from last year) and we will know more after its earnings report his week.

A transition can be a pain for well-established players, but it's usually also an opportunity to gain share and increase profits. While it's hard to say yet how the market will shape up, there's one thing they're serving us boat loads of: hope.

Acquisitions: All In a Day's Work

Apple, Facebook and Yahoo picked up a few more startups last week.

Apple's focus was on improving its mapping software, although a possible acquisition of PrimeSense (the company behind Microsoft's Kinect is also on the cards). The mapping companies Locationary and HopStop combine user-generated information with internal algorithms to provide information regarding businesses (Locationary) and traffic (HopStop), much like Waze that Google paid more than a billion dollars for.

Facebook, on the other hand, picked up software company Monoidics that removes bugs from other software or aps. Facebook's focus on acquiring and retaining customers has led it to this acquisition, which is likely to improve the quality of its products and also bring some good engineers aboard.

Yahoo's acquisitions were targeted at improving its advertising products. Admovate is expected to improve the targeting of ads, especially on mobile devices, while Ztelic is expected to help social data analysis.

Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

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