Jules,
I wouldn't worry at all about Intel's sluggish stock performance
as of late. Remember, Intel's been up almost 200% since its
year low of 50 and nasdaq's been up about 30%. Tech stock's
are just taking a breather right now, based on technical factors
only (e.g. profit taking, money moving out of big tech cos into other
industrys, etc.).
Fundamentally, things couldn't look better for Intel. From what
I hear, 1997 will be an absolute HUGE year in Corporate IT
Purchases alone. And remember, retails sales are supposedly
anemic. INTEL has publicly stated that they are running at
full capacity and probably will continue to do so into 2Q.
Even DELL, CPQ, have publicly stated a GREAT 1997. (Imagine
when retail sales pick up...)
As for competition, the trend is clear: People are moving to
NT as their operating system and Pentium/PPROs is the hardware
platform of choice. PowerPC has left the arena (except for
DEC ALPHA), which just leaves the smaller X86 clones, Cyrix and
AMD.
I feel that Intel can earn $9 next year in their sleep.
In other words, Intel is still a cheap stock with much growth
potential. You can figure the PE X $9 = >$200 post split
next year.
As for short-term, I would expect $130-$131 to be good support,
expect a bounce by end of year, another bounce in anticipation
of good earnings, and then depending on earnings and future
forecast, either profit taking or $150+ by end of January.
I xpect a huge 4Q, with close to 60% margins, >> $2 a share,
and Intel coming out with a rosy forecast. In other words, I
expect Intel to be at $150+ by end of Jan.
Happy Holidays,
Joey |
