Kash, On the subject of cheapo stocks.
I don't disagree with what you wrote. but I'm going to post some opposing views here. Don't think they're cast in stone, don't take them as criticism. I'm thinking about most of them and using the thread as a sounding board.
Re: <The absolute worst case scenario IMHO is another 50% haircut.>
A 50% haircut sounds unlikely to me also, *Unless something else bad happens*. Two weeks ago I was thinking that a lot of *STUFF* was right priced. I got some of that *STUFF this week at another 40% off. And at times this week I was wondering if I shouldn't be selling and selling more short!
On the PC biz.
There are few market segments where the ENTRY cost and IP cost is so high and only two VIABLE suppliers.<i/I>
Yes, but some would argue that AMD's not viable except as a crumb licker kept around to avoid anti-trust problems.
64 bit merced should start to contribute in 2-3 years
I think you've got the time frame about right. I think INTC & HWP have a mouthfull trying to get that dog to hunt. I don't know if you've ever worked on a major failing project. I have. From my view(and I'm way outside, in the software biz, not silicon) there is a very good chance the 64 bit X-86 silicon isn't going to make it on .13. I don't think they realized the difficulty of 64 bit CISC.
The brand is still so very strong - to such an extent that there are no single Business solutions. Outrageous. There is no stronger, IMO, in the world. And they have the marketing and PR to back it up. Has their hubris led them down the primrose path? Stay tuned for the next episode. They can build the compilers, drivers, bench marks, etc. to make anything look good. And the INTC name is *SO STRONG*. AMD cannot succeed.
Another point of view.
The PIV is a crock. It's the best thing that could have happened for AMD. INTC's going to be screwing around with this thing for 3 years before they get another design out. Hammer is out next year.(But will it be any good or will it be a dud.) Jackson Technology(SMT) -- don't be silly -- SMP blows it away. And Multicore Multithread(should I cr MM or McMt?) should be better still. Having said all that, let me say that's from the software side of the shop today. In 3 years SMT on MM is going to be *HOT*, but it won't be PIV & I don't think it'll be a Merced derivative. INTC must have had AAPL in mind as their chief competitor when they started the PIV design.
If AMD screws up Intel could easily be worth 4-5 todays valuation. INTC is at 5 times sales today. Do you really think it can go to 20 times todays sales in the next couple of years? We're not talking about a fast growing market anymore. This turkey is *STILL* the classic short.(Except for it's Current Ratio and D/E figures.)
Both companies have overcapacity. As do almost all industry groups. Massive deflation is a strong possablity. If that case plays out shorts are the best alternative.
Just thinking in message and trying to figure out what to do next,
tgptndr |
