Mike, Michel, Martin, or whomever you are >>>"but no matter what he
Kurlak says, the market is not going to grant Intel a PE like Pfizer's. They dont deserve it."
I tend to agree with Thomas Pittman and will offer that link: <<<
Pfeizer is one of several large drug companies in the United States with half the sales of Intel and a P/E of ~63. Viagra is indeed a hot item - in more ways than one - and if Pfeizer can monopolize this market, I would agree with you. Intel would not deserve equal billing or an equal P/E ratio.
Love potions, however, come (eg, chocolates, oysters, rhinocerous horn, oxtails, spanish fly, et al) and go - and Viagra will not be the last (guaranteed).
But for the 21st Century - what is more important than semiconductors and what is more important than microprocessors. The franchise that has this monoply is certainly worth more (vis-a-vis P/E) than the average Standard and Poors issue - currently ~28 - don't you think?.
But, regardless, how you segue to "valuations adjusted for stock options" from here is very curious. How you decided to take the Forbes Article and single out Intel for bashing is even more perplexing.
1. There are many, many companies that have options allocations as a percentage of their share outstanding far in excess of Intel. And, some of these companies are arguably the best in the country, namely, Morgan Stanley, JP Morgan, Bank America, Bankers Trust, Microsoft, and Warner Lambert. Even, Merrill Lynch, Tom Kurlak' own company has options allocation in excess of 50% as a percentage of all shares outstanding. I doubt Kurlak will use this as an argument to downgrade Intel.
2. As for your Table 3, MSFT would have shown a loss of $10B instead of a $2B profit. And, Companies like Cisco, Bristol Myers, Lilly would all show losses larger than Intel. The logical conclusion is that all these companies are vastly over valued and come the deluge the devaluation of these companies would inevitably crash the market.
I hope your wishes do not come true.
Mary
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