The Zacks Analyst Blog Highlights:Google, Microsoft, Facebook, Computing Sciences and Amazon

Feb 04, 2014, 09:30 ET from Zacks Investment Research, Inc.

CHICAGO, Feb. 4, 2014 /PRNewswire/ -- 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 the Google (Nasdaq: GOOG-Free Report), Microsoft (Nasdaq: MSFT-Free Report), Facebook (Nasdaq: FB-Free Report), Computing Sciences Corporation (NYSE: CSC-Free Report) and Amazon (Nasdaq: AMZN-Free Report).


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

Google Sells Motorola Mobility

Just the day before it reported fourth quarter numbers, Google (Nasdaq: GOOG-Free Report) announced its decision to sell Motorola to Lenovo for $2.91 billion. Google retained 15,000 of the 17,000 patents that it acquired from Motorola although it agreed to license some of them to Lenovo.

It was very important for Google to sell off this unit not just because it was making losses, but also because it was outside the area of its core competency. Moreover, Google could never go all-out with a hardware business and not alienate its hardware partners, which is a risk it can hardly afford to take.

Microsoft's Next CEO: Satya Nadella or Sundar Pichai?

Unidentified sources are saying that Indian-born Satya Nadella will likely succeed Ballmer as Microsoft's (Nasdaq: MSFT-Free Report) next CEO. It's also likely that founder Gates will make way for a successor to his position as Chairman of the Board.

This may look like an intention to radically change Microsoft's direction and operation. But like it or not, the direction was actually set last year with the announcement of Ballmer's "Devices and Services" strategy and the multi-billion-dollar acquisition of Nokia's loss-making handset business.

Granted, Nadella is a cloud-services man, so he is more focused on the services side of the business, but given his lack of experience at the top position of any company, it's very likely that he will not make radical changes on the devices side. And while he may be up for criticism, the best thing for Microsoft would probably be for him to do just that until he settles in.

After all, the devices side, while not making money, is of great strategic importance to Microsoft, and execution appears to be improving on that front. Things may get difficult, however, once activist investor ValueAct Holdings gets a seat on the Board.

It's also worth noting that several outsiders have refused the CEO position considering the many challenges. So Nadella definitely has his hands full.    

[Update: Latest media reports say that Sundar Pichai, SVP of Chrome and Apps at Google is now in the running and is the top external candidate.] 

Earnings Highlights: Here are some of the biggest movers

Facebook (Nasdaq: FB-Free Report) shares jumped 14.1% following the announcement of its fourth-quarter results. Very strong advertising revenue, particularly in the mobile business drove up shares.

Computing Sciences Corporation (NYSE: CSC-Free Report) shares were up 9.5% following its third-quarter results. Despite the disappointment on the top line that was severely impacted delayed spending and deferrals by the government, earnings came in much higher than expected due to excellent cost control. Considering lower cost structure and solid bookings, management was able to raise fiscal 2014 earnings guidance from 3.50-3.70 a share to $3.80-3.90 share

Google's earnings disappointed, but shares still appreciated 4.0%, as the euphoria of the Motorola sell-off spilled over. Google did see solid increase in paid clicks, but prices did not keep up.

The greatest disappointment was perhaps Amazon (Nasdaq: AMZN-Free Report), which lost 11% following its fourth-quarter results. Growth in the EGM business dropped off sharply in both North America and internationally. At the same time, Amazon's investments continued to increase, driving up costs. Guidance was soft. Increase in Prime fees was a positive.

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

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