Intel Corporation (INTC) Message Board

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Intel Corporation (INTC)

INTC 50.59

+4.9%

Feb 6 4:00 PM EST

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next

To: Flair who wrote (36296)	10/16/1997 4:58:00 PM
From: Jimbo	of 186894

Hello to everyone: I would like to post excerpts from Tom Kurlak's update on Intel for everyone to comment upon: Growth over for a while. Intel reported Q3 earnings below expectations .... Management is less optimistic about the outlook for growth in Q4.. As reported earlier by AMD and TI Intel's booked to billed ratio is believed to be under 1.0. OEM's are reducing inventories which was unexpected by Intel. Japan's downturn is not fully understood ... This combined set of projections for sales and margin is decidedly less robust than either management had felt months ago .. Clearly, some softening has occured in the market which appears to be aggravated by customers tightening inventories. We estimate Intel grew shipments of the PII to about 1.2 M units from .3 M estimated in Q2. For Q4 we are projecting 4.5 M, less than our previous 5.8 M estimate. at the same time sales of older pentium and pentium mmx appear to be higher than expected as the lower end of the pc market is gaining momentum. The average selling price for processors is estimated to have declined 6% to $235 from $251 in q2 whle units are estimated to have grown 12% to 19.4 M. In q4 we project a 10% asp decline and 13% unit increase to 22M. This implies 2% sequential sales increase in q4 which is 2% down from year ago level. For now, GROWTH HAS STOPPED at Intel. ( All caps is mine) Since expenses are likely to be up 12-13% in Q4 ..... earnings likely .. 20% below ..last year's earnings of $1.07 a share. In addition, completion of CHIPS and Technologies acquisition will produce. writeoff of .06. Our final Q4 estimate is reduced from $1.27 to $0.80 a share making full year $3.70 (vs $4.21 previous estimate) Going forward in 1998, we are concerned about the need to substantially lower pricing to accommodate the lower priced PC trend ....Leading PC companies selling sub-$1000 .. may have to consider non-Intel alternatives if Intel fails to meet necessary pricing economics for htis burgeoning low end market. We now look for a string of sequentially flat quarters in to 1998 as Intel cuts prices while growing units and while margines slide lower as depreciation accelerates. Our new 1998 earnings estimate is $3.50 - $3.75 a share, down from $4.90 previously and flat to down from this year. Stock Price Outlook Based on our new estimates and the likely reduction in the consesus forecast, we expect Intel's stock to be weak over the near term. A reassessment of Intel's position will be necessary with regard to developing fundamental industry trends later this year ..... recommend cautious stance near term. Sales and Earnings Model follows (from which I will just hilight a portion) 1997 1998 q1 q2 q3 q4 fy97 q1 q2 q3 q4 fy98 EPS 1.1 .92 .88 .80 3.70 .85 .87 .88 .95 3.55 (END OF EXCERPTS) Well, comments anyone?

Report TOU Violation

Share This Post

Public Reply Prvt Reply Mark as Last Read File

Previous 10 Next 10 Previous Next