A number of people have written posts about Microsoft's poor stock performance over the past week but there are two posts I thought were interesting enough to share on my blog.

In his post 7 years ago Omar Shahine writes

I started working at Microsoft. Just as a data point, the “strike price” for my first option grant was $31.7250. Today, the stock is trading around $26. At 7 years, there are two notable events:

• You start to accrue 4 weeks of vacation per year
• Your first stock option grant expires

So long option grant #1, I barely knew you . What are the chances the stock will shoot up 5 bucks in the next few hours so I can sell my grant?

On a more serious note, has the company really done so little in the last 7 years that the stock price warrants being down 19%? Will 2006 be the year MSFT rebounds? I sure hope so.

Anyway, it’s been a great 7 years. I look forward to the next few! Microsoft has been great to me over the years.

From a response by Andrew Leckey in the letters page of the Orlando Sentinel we get the item Shift to Internet impacts Microsoft stock which states

Q: I really expected more from my shares of Microsoft Corp. Has tech left it behind?

K.T., via the Internet

A: Microsoft rolled out its hot-selling Xbox 360 video-game console worldwide months ahead of rival Sony's next-generation PlayStation 3.

It is developing an online classified ad service to compete with the popular Craigslist. And it is entering the high-end supercomputer market with a version of Windows that ties together computers in a high-speed network.

But even though Chairman Bill Gates is the world's richest man and the firm has an unparalleled financial record and a mountain of cash, Microsoft gets no respect.

It is now frequently considered a value stock rather than a growth stock, a lumbering tech giant attracting investors with a relatively modest share price.

Microsoft stock fell 2 percent in 2005, following a drop of 2 percent in 2004 and a gain of 6 percent in 2003. Compare that to skyrocketing Google Inc. or Microsoft's own track record for 1996 through 2002, when its shares jumped nearly 400 percent.

Its highly profitable, industry-dominant Windows and Office software account for about 60 percent of its revenue, with an additional 25 percent coming from software for enterprise servers. New software products are continually being introduced.

The corporate vision is to expand beyond all that via the Xbox, Windows Mobile, Windows Media Center and IPTV platform to become the center of the digital home.

Because Microsoft shares look inexpensive in light of the potential to accomplish that, the Wall Street consensus recommendation is midway between "strong buy" and "buy," according to Thomson Financial. That consists of 14 "strong buys," 16 "buys," four "holds" and one "strong sell."

The biggest challenge, termed a "sea change" by Gates, is an industrywide shift to Internet-based software and services for everything from word processing to photo storage. This could make its conventional software packages less relevant.

Earnings are expected to increase 14 percent in fiscal 2006, which ends in June, the same estimate as for the application software industry.

I feel the same way as Omar does. You don't have to do the math and figure out my option grant from when I was hired four years ago to tell that it is underwater. However working at Microsoft has been great this past four years (wow, that long?) and I look forward to the next few years building social software for MSN Windows Live. It is interesting that Andrew Leckey feels that our biggest challenge Web-based software, it's definitely going to be an interesting year.