Microsoft (Shutterstock photo)
Microsoft (MSFT) has successfully managed to reinvent itself under CEO Satya Nadella, but it's due to the company's strong financial position it's even had the opportunity.
"The Cash Flow Quality rating improved the most during the most recent quarter," Jefferson Research wrote in a recent investor note.
Under Nadella, Microsoft has pushed towards making its cash-cow Office franchise available anywhere, via Office 365. It's also become the second-largest cloud computing vendor, behind Amazon Web Services, as more firms look to store their wares in the public cloud. It has embraced new platforms, such as 2-in-1 devices (i.e. Surface), augmented reality (HoloLens), and become the defacto leader in Silicon Valley for artificial intelligence, even as its competitors poach some of its employees.
All of this -- and more -- has helped push Microsoft's market cap over $500 billion, up more than 100% over the past five years, trouncing the returns seen in the S&P 500 and the broader Nasdaq.
A compilation of analysts estimates from Nasdaq shows a strong bullish forecast for Microsoft over the next few days ahead of the results.
Microsoft is expected to earn 70 cents a share and generate $23.62 billion in revenue for the fiscal third-quarter.
Investors should consider these three ETFs which have high exposure to Microsoft if they like what they see from the tech conglomerate.
iShares U.S. Technology ETF
iShares U.S. Technology ETF, which has $3.23 billion in assets under management, has 12.03% of its portfolio in Microsoft shares. It also charges investors a 0.43% expense fee for managing the assets.
Technology Select Sector SPDR Fund
The Technology Select Sector SPDR Fund, which has $16.78 billion in assets under management, has 10.19% of its portfolio in Microsoft shares. It also charges investors a 0.14% expense fee for managing the assets.
Vanguard Information Technology ETF
The Vanguard Information Technology ETF, which has $11.98 billion in assets under management, has 9.35% of its portfolio in Microsoft shares. It also charges investors a 0.14% expense fee for managing the assets.