Paul,>>>Well their forecast for sub-zero PC sales was wrong.<<<
So what. These things happen. Did Bill Gates forecast the growth of the Internet in 1995-96?
>>>This whole sector could be about to undergo a gut-wrenching change to a higher volume low price lower margin environment<<<
This could be said for any business. Where is there a business that is not subject to competition? The point is - do you or Kurlak know something about the future that we don't. If you do, why don't you share it with us?
>>>Finally Intel's accounting leaves out a significant employment cost, the 'cost' of the options they have been handing out<<<
That's not in the current definition of cost according to current accounting regs. But, if that is your argument - then MSFT, Merrill Lynch (Kurlak's company has more than twice the percentage - over 50% of options granted as to number of shares outstanding), Bank of American, and many other companies have higher liabilities. If that is your argument then the whole stock market is overvalued and Intel is not the most vulnerable in this respect.
And, besides, the data used for that article in Forbes is questionable wrt reliability. In some cases they forgot to take into consideration stock splits in 1996. And to quote Reginald Middleton on the MSFT thread:
>>>Like you know what you are talking about. If you add back options expense, don't froget to add back deferred revenues, pre-paid expenses, markiung real estate to market, including LIFO reserves, and deferred taxes and warranty reserves. Now, after all of that, where do the profits stand?<<<
>>>All I'm saying, is there are good reasons for this stock to trade at discounted PE to the market, given the risks in the MPU sector.<<<
Like you know what you are talking about <gggg> - what are the reasons for the low valuation? and compared to what? Compare it to the rest of the Nasdaq listing of 5240 stocks and this is what you get:
Market
Value Earnings P/E
__________________________________________
Nasdaq Composite $2003.3 $29.7 67.5
Intel (INTC) 127.6 6.9 18.4
Nasdaq less 1875.7 22.8 82.3
INTC
And tell us about the risks for MPU sector? Going forward, what is a more important sector than MPUs? What are the risks that MPU's will not take over the market now occupied by IBM and CMOS in the mainframe sector?
>>>Find sector growing 20%+ over LT, dominated by 2-5 companies. Buy
all dominant players in rough proportion their share of the sector<<<
Mary |
