<Currently, Intel success is build on soft bases (marketing, misleading AD, OEM arm twisting, and legal protection, etc.), not on solid technology. The 120+ billion market cap Intel could collapse in 5 years so could its stock price be crashed below its book value ($16.68) in 5 months.
The coming INTC crashes would be one of most important events in our history.>
I originally wanted to reply " that is absolutely ridiculous," but I think I will tone downthe reply a bit. Technology does not win the race, business strategy does. If it was strictly about techonlogy, OS/2 would have beat Windows, so would have Geoworks. The DEC Alpha would have taken out INTC, etc. INTC has built a very powerful frachise, that effectively locks out competition. On top of that, due to thier economomies of scale, they actually are the price performance leaders (when paired with MSFT) in MANY different categories. I conservatively put INTC at 400% increase over the next five years, and can back it up with REAL numbers, and not simply a book value calculation. Book value is useless in valuing a corporation due to the fact that it attemtps to measure the break-up value of a company (as an accountant would) and does not take into account the entity as an ogoing operation and appropriately discount future cash flows.
I can go on, but alas, I shall not. If you want to see the numbers, proceed to rcmfinancial.com , fill out the form and proceed to the download link provided and select the Intel analysis link. This "summary analysis uses investment bank style discounted cash flow and discouned economic profit methodogies to arrive at the projected values under 54 different interest rate and growth scenarios. For a glance at a full economic report which generates the summary, download the Novell economic analysis. For information and discussion regarding the logic and reasoning behind the methodologies used, reference exchange2000.com or the valuation primer on the New Media Financial portion of the site referenced earlier (obtainable fromthe header links).
I look forward to your comments. |
