It may want to, but is it technically feasible? It isn't like it is simply buying off the shelf parts, because this is bleeding edge tech.
Message 23272376
Four Picks In Semi-Cap To Benefit From New Intel Plant
Ed Lin, 11.15.05, 9:48 AM ET
Intel
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UBS Investment Research analyst Stephen Chin said media reports from Israel indicate that Intel (nasdaq: INTC - news - people ) may be building its second 300 mm, 45 nm plant. The company's first is in Arizona.
The new plant, known as fab 28, in Israel is expected to require a $4.4 billion investment, "of which we believe about 62% would be for equipment, representing 38% more than our estimate for Intel's 45 nm fab in Arizona," Chin wrote in a research report.
Chin noted that semiconductor-capital equipment companies Varian Semiconductor Equipment Associates (nasdaq: VSEA - news - people ), KLA-Tencor (nasdaq: KLAC - news - people ), Applied Materials (nasdaq: AMAT - news - people ) and Novellus Systems (nasdaq: NVLS - news - people ) will all benefit from the new Intel plant.
Varian has the most potential sales and earnings-per-share upside, as much as $140 million and 37 cents per share, respectively, starting in calendar 2007, he said.
The analyst said KLA-Tencor, Applied Materials and Novellus "will likely maintain their existing 65 nm product relationships with Intel into its 45 nm node. We estimate Intel represents 8% to 9% of KLA-Tencor's and Applied Materials' sales, and slightly over 10% of Novellus' sales."
An earlier version of this story incorrectly said that Varian, KLA-Tencor, Applied Materials and Novellus were electronics manufacturing services companies.
No comments regarding this? Where are the option gurus?
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