Could have switched into Goldman sachs from amat when GS was 160 at the bottom.
GS was close to 52 week high today - so much for the liquidity crisis. Sure looks like an uphill battle.
Some stocks within the sector might be doing OK but GS and ML will not push chips no matter how good or bad things are.
UPDATE 1-RESEARCH ALERT-Morgan Stanley starts Intel, AMD, Nvidia
Wed Oct 3, 2007 1:16pm EDT
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Oct 3 (Reuters) - Morgan Stanley initiated coverage of chipmakers Intel Corp (INTC.O: Quote, Profile, Research), Advanced Micro Devices Inc (AMD.N: Quote, Profile, Research) and Nvidia Corp (NVDA.O: Quote, Profile, Research) with "underweight" ratings.
Morgan Stanley said it recommends investors reduce positions in Intel and AMD ahead of what it expects would be an inventory correction and increasingly aggressive price environment.
The brokerage said while it has some long-term concerns centered on the maturing of the PC industry, its underweight rating is driven more by near-term concerns around the elevated risk of double ordering and overcapacity.
With new products increasing competition, Morgan Stanley also expects Intel to lose some share to AMD in 2008.
Though the brokerage said AMD's cash flow challenge will be felt over the next year or two, the company's liquidity issues combined with excess capacity translates into a higher probability that it will run fabrication plants at full capacity to generate desperately needed cash.
This, in turn, would accelerate the erosion of average selling price of chips, the brokerage added.
On graphic chipmaker Nvidia, the brokerage said a "perfect storm" of positive events that drove share gains and revenue acceleration is winding down, including the gains from AMD's acquisition of Nvidia rival, ATI Technologies.
Morgan Stanley has a price target of $22 on Intel's stock. For AMD, it has a $11 target and on Nvidia stock the target is $32. |
