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Technology Stocks : Intel Corporation (INTC)

INTC 36.35

+0.7%

1:04 PM EST

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To: rkral who wrote (180985)	5/5/2005 12:37:44 PM
From: Proud_Infidel	Read Replies (2) of 186894

Intel Dual-Core Chips Won't Drive Rev Upside In 2005 05.05.05, 12:27 PM ET Credit Suisse First Boston maintained an "underperform" rating for Intel (nasdaq: INTC - news - people ) ahead of the semiconductor company's analyst meeting set for this afternoon. Intel is expected to focus on its growth strategies with an emphasis on wireless products and dual-core chips. "Intel's shift to platforms will again take center stage, with the company emphasizing its ability to integrate multiple components (processor, chipsets, communications, and security) to drive a better PC platform," said CSFB. "Success with platforms is Intel's best opportunity to drive higher content per box and increase share. However, we believe the company does not yet have the same compelling platform benefits for desktop and servers that it found with notebooks (mobility and battery life)." The research firm anticipates Intel will maintain its premium pricing for dual-core chips. "We expect greater clarity on the value proposition and ramp plan for its dual core processors," it said. "As the company has implemented its initial dual-core processor on the 90nm process node with a significantly larger die size, we expect the company to maintain premium pricing to limit volumes and offset its higher manufacturing costs until it shrinks the die with 65nm in early 2006. Consequently, we do not see dual core being a material incremental revenue driver through 2005." CSFB noted last month that Intel faces a "pricing dilemma" for its dual-core processors after Dell (nasdaq: DELL - news - people ) indicated it will not raise prices for PCs equipped with the new and more costly chips. The firm also said it doesn't expect Intel to provide second-quarter guidance until later this month and maintained a $23 target price on Intel shares. Intel has just come off a surprisingly solid first quarter, in contrast to the past year or so when the company was beset by product delays and realignments. (See Street May Get Good Vibes From Intel.)

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