GV, Here's one reality check:
Tom Kurlak
Message 20306502
"This ratio of spending to sales is in line with the industry's 20-year long-term average and is only half of the level at the last cycle peak. Today, the CEO of Applied Materials (NasdaqNM:AMAT - News) commented on CNBC that his customers are planning to buy more equipment, are upbeat and need the newest equipment technology to meet rising demand.
semiconductor companies aren't having an inventory buildup that is out of line with what is normal this time of year in anticipation of seasonally stronger second-half demand. That's especially true in Intel's
...I've never seen a major cycle peak out after only a year and a half."
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GV, I think you are incorrectly trying to attribute a sinister reason for a build up of inventory.
Intel's guidance shows they believe H2 will be strong. Why on earth wouldn't you want them to prepare for it?
If I had been in Intel's shoes, I would have made the same decision, if I felt H2 was going to be strong. Why pay more? Doesn't make sense to pay more.
RE: "you need a reality check. IMO, every company in the S&P 500 save for perhaps 5 or 6 manage their business way, way too much to please Wall Street."
While WS is important, let's not let WS get too egotistical here. High-tech spins on its own axis. Maximizing total annual cost savings is much more important than a WS quarterly earnings report, in the scheme of things.
Intel's decision might be proven wrong - H2 might not be strong - but that's a different matter than attributing sinister reasons to their decision.
Kurlak's report is very convincing to me. Am going to buy some Intc. (I don't have a clue which way the wind will blow in H2, recent earnings reports certainly look mixed, but this is a LT hold.)
Regards,
Amy J |
