Microsoft Corp. is a stock that investors love to hate.

And after the software king posted disappointing earnings a few weeks ago, the bears were armed with even more reasons Microsoft MSFT, -1.24% stock is a waste of time and money.

Sure, a less than 5% growth rate in sales for its Windows and server software business is down from previous quarters, and there are hints of serious trouble in Microsoft’s core business. Also, a disappointing forecast for the rest of the year shows that the problems will continue weighing on the tech giant’s income statement for some time.

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But a steep decline in a few trading days after the report seemed far too severe a reaction given some of the other encouraging things going on at Microsoft.

Here’s why the stock is still a buy right now, even with the decline after earnings and even as the Nasdaq COMP, -1.07% is at its highest level since the dot-com days:

1. Shares are rebounding: The first indicator of note is Microsoft’s share price. While the stock tanked about 15% post-earnings, from around $47 to around $40 a share by January 30, it’s already around $44 again after a nice run in the last several sessions. That’s not back to square just yet, but a good sign that the initial downward momentum was short-lived and negativity is fading.

2. Overall earnings weren’t so bad: On the whole, Microsoft’s earnings were in line — revenue of $26.5 billion topped expectations of $26.3 billion, and was up 8% from the previous year. Earnings of 71 cents were down slightly year-over-year largely due to restructuring charges and currency exchange headwinds, but still hit the mark. That doesn’t sound like a looming disaster in the works, even if the details in the core Windows business were weak.

3. Cloud holds promise: While bears have zeroed in on the core challenges of Windows, particularly in Asia, there are promising details from Microsoft’s cloud software businesses. Consider that while revenue in its commercial segment was up just 5%, commercial cloud revenue more than doubled to an annualized run rate of $5.5 billion. That’s still not quite the cash cow Microsoft would like it to be, but a promising sign long-term as the company continues to focus on subscription-based cloud platforms including Azure and Office 365.

4. Don’t scoff at Surface: Sure, the iPad from Apple Inc. AAPL, -3.17% is still the gold standard for tablets. But the iPad saw a sharp 22% drop in revenue last quarter as Apple moved away from its tablet line and towards larger iPhones — while Microsoft’s Surface enjoyed sales growth of 24%. Admittedly, Microsoft is coming from a smaller base as Surface recorded just $1.1 billion in total sales vs. almost $9 billion for the iPad. But if this trend continues it could result in a substantial mobile hardware business for Microsoft in a year or two, even if it remains behind Apple.

5. Dividends and buybacks: Microsoft spent more than $2 billion on stock buybacks last quarter, and reaffirmed plans to complete an existing $40 billion repurchase plan by Dec. 31, 2016. There are around 8.2 billion basic shares of Microsoft stock currently, compared with 8.3 billion at the end of 2013 and almost 8.4 billion at the end of 2012. Moreover, Microsoft offers a 2.8% dividend yield that is highly sustainable and ripe for increases at around 40% of earnings. This is a company that is serious about returning capital to shareholders over the long-term.

6. Attractive valuation: After this recent pullback, Microsoft trades at a forward price-to-earnings ratio of a little less than 15. Not only is that much cheaper than tech stocks in general, but it’s significantly under the roughly 17.6 earnings multiple of the S&P 500 SPX, -1.11% .

7. Windows 10 and PC optimism: Many investors are looking ahead to the highly anticipated release of Windows 10 as an indicator of things to come. And after the recent earnings report, the pressure is on for Windows 10 to prove its mettle. Thankfully, new data from IDC and Gartner are encouraging because they both indicate stronger-than-expected PC sales after a soft holiday quarter — with Gartner actually reporting a gain instead of an expected decline. This bodes well for Windows licensing for this all-important launch.

As a final note, remember that Wall Street reacted so negatively after ho-hum earnings is because optimism has been strong in the last year or so; Microsoft stock nearly doubled from the start of 2013 to Thanksgiving of 2014.

And this was despite the company being elbow-deep into an ambitious restructuring plan announced in 2013 that included the departure of CEO Steve Ballmer, and admitted deficiencies in its approach to mobile and post-PC tech options.

Microsoft managed almost 12% revenue growth in fiscal 2014, but this was in part because the tech giant stopped supporting the ancient Windows XP operating system and got a one-time bump from some forced upgrades.

The future will not be quite so easy — with more bumps along the way. But based on the details highlighted here, the future holds promise for Microsoft and its patient investors.