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Technology Stocks : Intel Corporation (INTC)
INTC 50.59+4.9%Feb 6 9:30 AM EST

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To: James Rogers who wrote (1631)6/4/1996 1:38:00 PM
From: Paul Chiu   of 186894
 
James,

INTC had P/E over 20 in both late 92-early 93 with a peak at 24.5 on March 19,93 and last June.

Since March of 1992, INTC has an average P/E of 15.35, we're currently at 19 or so. Analysts estimates stand at 4.47 for yr, translates to P/E of 17.25. Overall market P/E nears 20, overvalue by historical standards. Based on the market, INTC is undervalued for a company with 10-15% growth prospects for the next few years. By INTC's IRR, maybe you're right to state that INTC is overvalued. John Hull, what do you think?

I see little reason why INTC cannot expand its market multiple to 3/4 of large companies like CSCO (38 P/E).

The current rally might have been a tad too much in intensity. Maybe I'll write some out-of-the-money calls.

Paul
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