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Technology Stocks : Is Intel a $100 stock next year
INTC 39.99-0.4%Oct 31 9:30 AM EDT

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To: Burt Masnick who started this subject12/20/1995 10:01:00 PM
From: Gary Walker   of 58
 
$100 stock? Maybe a $1000 stock?

Intel is a strong company in many ways. Their earning power is stupendous, and their history of winning strategies is long. I wouldn't be surprised if INTC is a $1000 stock within 10 years.

In the short run we cannot ignore the buildup of semi's capacities. This will drive market prices up and down and drive investors crazy. I've said it here before. Buy the stock, put it away for 5 years or so and don't read the stock quotes daily. (for sanity reasons, PS I wish I could follow my own advice!!) Check each year to be sure cost of capital is exceeded by return on capital employed. If the return is negative, look at the fundementals, ie. product success record, etc. because high tech stocks during periods of high investment could see a return less than their cost of capital. This is normal but could indicate trouble ahead. If you cannot come up with a reason for the failure to earn a return of at least the cost of capital, then sell.

Another item to watch is the success of the P6 processor. The whole situation is a little unusual. Win95 is not a true 32 bit code because many compromises were made to allow 16 bit software to run on the Win95 feed machines. The P-6 processor does not run much faster than a Pentium 133 mh machine when both are running Win95. At some point, MSFT will offer a true 32 bit code and fully ultilize the power of the P-6. There will a crossover point when more 32 bit than 16 bit software exists. Then the P-6 and INTEL will take off to another new level. Perhaps $1000/share!!

Happy Holidays.
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