Microsoft shares soar on talk of Office for iPads

Microsoft hit its highest level since 2000 Tuesday and was one of the top five performing stocks in the Standard & Poor's 500 on increasing chatter a version of Office is coming for Apple's iPad.

Shares of Microsoft gained $1.50, or 3.9%, to $39.55 in the stock's biggest one-day move in seven months. The stock is up nearly 6% this year, outpacing the broader market. Tuesday's rally alone lifted Microsoft's market value $12.5 billion to $328.3 billion.

Office is the dominant software and cloud service used by businesses and professionals to create documents, calculate spreadsheets and design presentations and graphics. By taking the service to Apple's iPad tablet computers, Microsoft would demonstrate its seriousness in using its edge in cloud-based services to bring services to all devices as a way to boost revenue.

There's been no formal announcement about Office for the iPad from Microsoft, but technology watchers increasingly expect it to be one of the first bold moves announced by Microsoft's new CEO, Satya Nadella. Nadella may announce Office for iPad at a Microsoft press event on March 27 in San Francisco, reports CNET.

Microsoft continues to show that while it may be behind competitors selling mobile hardware, it's ahead of others in the fast-growing cloud computing industry increasingly seen as the next frontier in computing. Microsoft's Azure cloud computing platform continues to grow at a rapid pace as developers see it as a low-cost way to build applications for consumers and businesses.

It's unclear how the Office suite will be delivered, but some expect it to be part of a subscription to Office 365. Office 365 is Microsoft's successful software-as-a-service business where companies and consumers essentially rent the ability to have the latest version of Office, as opposed to buying package software that expires in a few years.

Microsoft has been aggressive in making its software available not just on its own platforms, like Windows 8 and Windows Phone! 8, but on any device. This week, Microsoft made its note-taking software, OneNote, available on additional Apple devices for free. Unlike other technology companies that try to lock consumers into a platform, Microsoft's approach allows it to make money on other tech firms' platforms.

Despite the positive trends at Microsoft and with the stock, though, analysts are still slow to understand it, according to a note from Jason Trennert of Strategas Research Partners. The percentage of analysts who rate the stock a buy is at the lowest level in 15 years, Strategas says.

Investors are eager for Microsoft to move in this direction, according to a report by Raimo Lenschow of Barclays. "This is something that many investors have wanted the company to embrace for a long time, as it could not only provide a significant boost to Office revenue, but it would also signal that Microsoft is moving towards a more serious cross-platform strategy," Lenschow writes.