I see I'm chipping away at your hesitancy toward Intel. My
next task is to convince you trade up your MSFT into far
more lucrative INTCW.
Reasons:
1) Microsoft has high P/E and is overvalued (you said so
yourself). Intel has a P/E slightly above the S&P, which
IMHO is absolutely ridiculous.
2) Their fortunes are inexorably linked; we all know this.
3) They (the Illuminati) keep predicting a slowdown in
appetite for computers. Oddly, things like the Internet,
NT 4, and symmetric servers keep pushing the upper
limits of processing power. What's next? Interactive
groupware like telephony and videoconferencing,
real-time 3D, speech recognition, etc., etc. Intel is even
going to put CPUs in cars for god's sake!
4) Microsoft exquisitly manages Wall Street
expectations, then beats them by a few cents
consistently, thereby just satisfying predictable whisper
numbers. Intel was much more coy. And the analysts
look like the fools that they are when an earnings
surprise like just recently occurs. Now Intel has quit
bothering with guidance. So the analysts have free
reign to justify their prior nonsensicalness by spreading
incredibly *stupid* speculation that OEMs have been
hoarding CPUs. The fact that there is absolutely no
evidence for this (and evidence to the contrary, see
below) is of course, of no consequence.
5) Microsoft has worthy competitors in each of its core
businesses (Netscape, AOL, Corel, Lotus, Intuit, various
game manufacturers). Intel has no competitors except
negative-earnings Cyrix and AMD.
6) Refer to the couple URLs I've posted recently. Intel
can't make enough of their ultra-high margin PPros to
satisfy demand. Now, whaddaya think will happen when
they cut prices on these chips soon? Hmm, weren't we
talking about a blowout $1.75+ quarter recently? |
