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Has Microsoft (NASDAQ:MSFT) Become a 'Must Have' Income Investment?

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The immediate future doesn't seem great for Microsoft, but could owning its stock help you prepare for the long-term?

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MINYANVILLE ORIGINAL It's no secret to anyone that Microsoft (NASDAQ:MSFT) has been struggling to gain market share with its latest hardware releases, and is facing tepid growth overall. While not all of its new products are expected to be as disastrous as Nokia's (NYSE:NOK) Windows 8 Phone, analysts don't believe that the upcoming Surface tablet or the anticipated release of the Windows 8 operating system will provide the company with big enough hits to make it a major player again.

Still, despite the company's unenthusiastic expectations, investors might be wise to buy dividend stock in Microsoft now.

On September 18, Microsoft increased its dividend to 15%, which may indicate some optimism in the company, despite predictions. According to an article by Seeking Alpha, Microsoft's new dividend will be $.23 per quarter, which amounts to a $.92 per share annual dividend. Based upon Microsoft's $31.19 stock price, the current yield is 2.9%.

In addition, Microsoft has bought back 16.6% of its shares since 2006, and seems committed to buying back over 8,000 shares yearly. Share reduction normally results is higher dividend increases, meaning that the recent change to 15% may just be the beginning.

On top of that, Microsoft's earnings per share has continued to grow over the years, and is expected to be $3.05 , even though the stock price has remained fairly stagnant. Revenues for the company have also grown considerably over the years, increasing from $44,282 million in 2006 to $73,723 million this year.
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