Intel Corporation (INTC) Message Board

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Technology Stocks : Intel Corporation (INTC)

INTC 37.81

-4.3%

Dec 12 9:30 AM EST

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To: Paul Engel who wrote (48385)	2/22/1998 1:36:00 AM
From: Paul Fiondella	Read Replies (4) of 186894

A low P/E for Intel? Did it ever occur to you that P/E's are lower in capital intensive industries for a reason. Hint: It has something to do with the incredible amount of investment required to build all of those FABS. Those billions have to come out of earnings. By comparison the cost of creating a new version of Windows software is mostly personnel. You have nearly fixed and constant product development costs but then the production costs are marginal, the cost of a CDROM. With the semis after you design the chip you still have to manufacture it. The semiconducter industy is a recognized capital intensive industry. P/E's reflect that fact. So figure that in the next time you swallow a bone and think Intel should have the same P/E as Microsoft.

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