Jim, >>>my opinion has not changed nor has my ownership of some Intel stock. If you go
back to Oct 13th and review the exchanges between Bug and I and all the
naysayers I get a VBSEG about it.<<<
There are quite a few reasons to be even more bullish on Intel now than in Oct., as I'm sure you know:
1. Intel is addressing the low cost PC market very seriously now, where they had been largely ignoring it. New decisions since October by Intel:
• They've announced that Celeron will be priced essentially equal to the chips of their only viable x86 competitor, AMD, $ for $, clock for clock.
• They've moved in release of 366 and 400 MHz Celerons to Jan. 4. Very bad news for AMD. Celeron is on track to sell 8 million copies this quarter. With Intel's fabulous yields, they will make decent margins on Celerons. AMD won't because they don't have the yields. With the 366 and 400, Intel will sell even more Celerons per quarter.
Bottom line is that Intel will make a lot of money with Celeron, not at the margins of their higher end chips, but they'll make up for it in volume.(No joke).
2. Intel is sold out of several speeds of the Pentium II. These get outstanding margin for Intel, again because of their outstanding yields and therefore low cost. Of course, the volume of PII is even higher than that of Celeron.
3. Intel announced way back in November that 4Q would exceed revenue expectations. It is unheard of to announce that early.
4. 1Q99 is looking close to 4Q98, depending on who you listen to. Usually, it's way off 4Q because of Christmas PC gift buying and corporate end of year budget clearing use or lose buying. Y2K is causing a boom in hardware sales across the board, and definitely not just in mainframes.
5. Xeon is propelling NT server sales at the expense of Unix based servers. However, Unix will continue to prosper as well.
All adds up to a major upgrade in Intel prospects, even compared with October.
Enough.
Tony |
