The other day I talked about my growing optimism toward Apple Inc. (NASDAQ/AAPL) under the stewardship of CEO Tim Cook.

Now, I've noticed that a similar situation appears to be unfolding at Microsoft Corporation (NASDAQ/MSFT), which is currently under the leadership of CEO Satya Nadella. Nadella is transforming the former Wall Street darling into an enterprise-driven company that's focused on capitalizing on new technologies, rather than simply on operating systems, as my stock analysis indicates. Former CEO Steve Ballmer failed to grasp the shift away from PCs and into the mobile sphere; something that Nadella is fully aware of and it's paying off for shareholders, as the stock is up nearly 50% from its 52-week low, according to my stock analysis.

MSFTChart courtesy of www.StockCharts.com

In the past, I have criticized the inability of Microsoft to adapt to the changes that were occurring in technology, as the company instead focused on its operating systems. The company's strategic shift to the Internet and mobile spaces makes a whole lot of sense and will make Microsoft relevant to investors again, as my stock analysis suggests.

However, my stock analysis also indicates that there are still some operating issues for Microsoft. The company is struggling with its acquisition of the cell phone business formerly owned by Nokia Corporation (NYSE/NOK). When you have to compete against the likes of the "iPhone" and Samsung Electronics Co., Ltd.'s phones running on Google Inc.'s (NASDAQ/GOOG) "Android" operating system, it will not be an easy undertaking, as my stock analysis suggests.

Microsoft (PD)The same goes for the "Surface" tablet. This is a great piece of technology, but it simply cannot keep up with the strong market interest and brand awareness for the "iPad."

Nadella likely realizes this and will adapt. He recently announced the elimination of more than 18,000 jobs, as he continues to streamline operations and cut products that are not delivering.

The second-quarter results reflected the negative impact of the Nokia business acquisition that resulted in lower year-over-year earnings. Excluding Nokia, the company beat consensus by $0.02 per share.

So while the company's operating system business will continue to be the main driver of revenues, my stock analysis indicates that the move to smartphones, tablets, entertainment gaming consoles, cloud computing, and other enterprise solutions will likely be the game-changer. For instance, the company's "Office 365" productivity package is now available on Apple Inc. (NASDAQ/AAPL) devices.

Instead of battling it out with Apple in the smartphone and tablet areas, my stock analysis indicates that Microsoft has taken the approach that it needs to take to develop solutions that can complement Apple devices instead of fighting them. Office 365 is an example of this co-operation.

Microsoft is looking to build apps for the iPad to gain access to its hundreds of millions of users. This clearly is a smart move by Nadella and based on the share price, the stock market is pleased with the new direction.

The company also still has a valuable application in its "Skype" call and text solution, which is excellent but is somewhat underappreciated by the market, based on my stock analysis.

So Microsoft is steadily becoming relevant again after a lost decade, and you can thank Nadella for that.

This article Why This Old Tech Stock Is Relevant Again was originally published at Daily Gains Letter.

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