INTC: Patent Infringement Article Misleading
Salomon Smith Barney
Wednesday, November 10, 1999
--SUMMARY:--Intel Corporation--Semiconductors
From a disclosure in Intel's regular 10Q filing, a Dow Jones news service
late yesterday wrote a misleading article that Intel had lost a "key
ruling" in an $8 billion microprocessor patent lawsuit.
--EARNINGS PER SHARE--------------------------------------------------------
FYE 1 Qtr 2 Qtr 3 Qtr 4 Qtr Year
Actual 12/98 EPS $0.41A $0.33A $0.44A $0.59A $1.77A
Previous 12/99 EPS $0.57A $0.51A $0.55A $0.59E $2.22E
Current 12/99 EPS $0.57A $0.51A $0.55A $0.59E $2.22E
Previous 12/00 EPS $0.57E $0.63E $0.71E $0.74E $2.65E
Current 12/00 EPS $0.57E $0.63E $0.71E $0.74E $2.65E
Previous 12/01 EPS $N/A $N/A $N/A $N/A $N/A
Current 12/01 EPS $N/A $N/A $N/A $N/A $N/A
Footnotes:
--FUNDAMENTALS--------------------------------------------------------------
Current Rank........:1M Prior:No Change Price (11/9/99).....:$80.06
P/E Ratio 12/99.....:36.1x Target Price..:$95.00 Prior:No Change
P/E Ratio 12/00.....:30.2x Proj.5yr EPS Grth...:25.0%
Return on Eqty 98...:N/A% Book Value/Shr(99)..:8.40
LT Debt-to-Capital(a)2.9% Dividend(99)........:$.12
Revenue (99)........:28874.00mil Yield...............:0.1%
Shares Outstanding..:3472.0mil Convertible.........:No
Mkt. Capitalization.:277968.3mil Hedge Clause(s).....:
Comments............:(a) Data as of the most recently reported quarter.
Comments............:
--OPINION:------------------------------------------------------------------
The lawsuit involves TechSearch, a group of lawyers that bought a
microprocessor patent last year from International Meta Systems, which
subsequently went under. TechSearch believes its patent is worth $2-8
billion. In fact, the ruling is only procedural; the case will be heard
by a jury in January. What the judge did rule was that the wording in the
patent could be interpreted "broadly", rather than "narrowly", which
theoretically opens up Intel to greater damages, should it lose. Jury
trials are hard to predict. Even so, a leading legal expert on
microprocessor patents tells us the patent is not a strong one, and that
the ruling could actually make it easier for Intel, who holds thousands
of basic microprocessor patents, to show the TechSearch patent is in
valid. This consultant believes Intel has the stronger case. For more
information on the plaintiffs in the Intel v.TechSearch lawsuit, see
www.techsearch-llc.com and www.ildf.com.
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