The Path to Riches: A Tale of 3 CEOs

Microsoft Corporation (MSFT), L Brands Inc (LB), and Oracle Corporation (ORCL) have made these three individuals very wealthy

Jan 30, 2015 at 11:58 AM
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MarketWatch recently unveiled a list of the richest person in each state. Many of these individuals are entrepreneurs who amassed their fortunes on the back of running successful businesses, including Bill Gates -- co-founder and former CEO of Microsoft Corporation (NASDAQ:MSFT) -- who topped the list as Washington state's wealthiest individual. Elsewhere, L Brands Inc (NYSE:LB) founder and CEO Les Wexner has emerged as Ohio's richest person, while co-founder and former CEO of Oracle Corporation (NYSE:ORCL), Larry Ellison, takes top billing as California's most affluent person.

Bill Gates co-founded MSFT with Paul Allen in 1975, and served as CEO until January 2000. He remained the company's chairman until February 2014, and was its largest individual shareholder until May 2014. As of this month, Gates' net worth is roughly $81.5 billion.

On the charts, MSFT hit an all-time peak of $59.97 in December 1999, but was last seen lingering near $40.96. Over the past year, the shares have tacked on 8.2%, but an earnings-related swoon earlier this week brought MSFT below levels not seen since last June -- and south of its 320-day moving average for the first time since April 2013.

Daily Chart of MSFT Since April 2013 With 320-Day Moving Average

On the sentiment front, options traders have been optimistic. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), for example, Microsoft Corporation's (NASDAQ:MSFT) 10-day call/put volume ratio of 2.21 ranks in the 85th annual percentile. Simply stated, calls have been bought to open over puts at a faster-than-usual clip in recent weeks.

Les Wexner started The Limited in 1963, and took the company public six years later. With Wexner at the helm, the firm has expanded its presence over the years with such divisions as Victoria's Secret, Bath & Body Works, and the now spun-off Abercrombie & Fitch Co. (NYSE:ANF). Moreover, Wexner holds the title of longest-serving CEO of a Fortune 500 firm, and has accumulated a net worth of roughly $5.1 billion.

Technically speaking, L Brands Inc (NYSE:LB) has done well over the past 52 weeks, boasting a gain of roughly 62%. Additionally, the stock is within striking distance of its all-time high of $87.58, tagged on Dec. 31. Today, however, the shares are off 1.5% at $85.05 amid broad-market headwinds.

Daily Chart of LB Since January 2014

Options traders have been skeptical, though, and at the ISE, CBOE, and PHLX, LB's 50-day put/call volume ratio of 2.76 rests higher than all other readings taken in the past year. Given the equity's technical tenacity, a portion of this put buying may be a result of shareholders protecting paper profits.

In 1977, Larry Ellison helped found a company which would eventually become Oracle Corporation (NYSE:ORCL), and was CEO of the firm until 2014. Since then, Ellison has remained chairman of the board and served as chief technology officer. His net worth is currently estimated at around $47.3 billion.

The stock has been a powerhouse on the charts since taking a sharp bounce off its 320-day moving average in late October, tacking on 18% to trade at $42.31. Additionally, the shares hit a record high of $46.71 on Dec. 24, but were more recently seen consolidating near their 60-day moving average.

Daily Chart of ORCL Since October 2014 With 60-Day and 320-Day Moving Averages

Not everyone has climbed on board ORCL's bullish bandwagon, though, which could spell additional gains for the equity down the road. Currently, 11 out of 27 covering analysts maintain a "hold" or worse rating on ORCL, while the average 12-month price target of $45.31 stands at a slim 7% premium to the stock's present perch. Should the security take a bounce from its 60-day moving average, a round of upgrades and/or price-target hikes could help propel ORCL higher.


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