INTC's in a malaise, and we don't yet see them pulling out of it
BY ADAM LASHINSKY
Mercury News Staff Writer
INTEL INTELLIGENCE: Investors expecting clarification on the future of the
personal computer industry wouldn't have found too much guidance from Intel
Corp. (Nasdaq, INTC), which released first-quarter earnings Tuesday that beat
Wall Street's recently downsized estimates.
But more troubling is Intel's report that no single company or region accounted for
the decrease in orders from PC makers.
''A lot of people were hoping they'd say it was Compaq,'' says Robert C.
Chaplinsky, the semiconductor analyst for Hambrecht & Quist LLC in San
Francisco. That's because pinning the declines on Compaq Computer Corp.
(NYSE, CPQ) would imply a company-specific slowdown more than a
industrywide phenomenon. Stock in Compaq, which reports earnings this morning,
surged 7 percent Tuesday to $26.06.
So where will Intel's stock go today? The experts disagree.
The stock moved up as much as $2, to about $78, in after-hours trading Tuesday.
But such low-volume activity isn't always an accurate gauge on the massive
trading sure to come today.
''Basically, it looks like the recovery is one quarter away,'' says Chaplinsky, who
saw a silver lining in Intel's higher-than-expected revenues and unexpected
budget cuts. ''Intel is being very aggressive on expense control.''
Jonathan J. Joseph, NationsBanc Montgomery Securities' chip watcher, says Intel's
next quarter won't necessarily represent the ''bottom'' in the company's
performance.
''The company's in a malaise, and we don't yet see them pulling out of it,'' he says. |
