I don't think that would be a wise idea with any stock you own, least of all one that is making new highs in already high priced market, that has its PE higher than any time in its history, and has an 85-90% dominence in their field with alot of hungry AND capable competitors breathing down their backs. THe beauty of capitalism is that these high margins that INTC has enjoyed for years as a monopoly are bound to evaporate when people start buying on competitive price. I owned Intel for 4 years, 1990-1994 and I have sadly missed a redoubling of my 10-12 times increase in stock value when I sold. But I sold because I have never known any monopoly that can sustain itself, and Intel seemed ripe for an anticipation of that competion with its erosion of margins, etc. I think I was a little early. My view of the collapse of a monopoly occurs when there are clearly better or equal alternatives at cheaper prices available, but the consuming public is still stuck with the old brand because they are still buying the ads, and the psuedo-security that goes along with them. The persistence of success in the face of these discordant realities presages the fall of the monoploy, and more frequently than not, the sudden decompression of the over-inflated balloon. Four recent examples that come to mind, Standard Oil in the 1890-1910 period, US steel companies in the mid 1960's, US auto makers in the 1970's, ATT in the 1970's, and IBM and DEC in the 1980's.
I think traveling for three years without paying any attention to INTC could result in a catastrophe, or if you are really lucky, a doubling of the price (value). However, how much upside is there left in a company that commands such high margins, has such a monopoly, is at its all time historically high PE, AND is approaching the worth of the most capitalized company in the US. GOing up from here seems alot harder for INTC than it has in the past. Of course I said that 1 1/2 years ago and missed another doubling of my money. |
