Another piece of Good news for DELL if true. Sig wake up willya?PER at $81.00 unbelievable.
Sig:
Well if the chip prices are falling,I don't see why Dell should be down as this will put more money into Dell's pocket,BTW that idiot Kurlak back again dumping on Intel,his diagnosis about AMD could be true though as they just cancelled out of a technology conference they were supposed to attend.
Oh by the way wake up.....and check where PER is!
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Chip price plunge shocks stocks
By Binti Harvey, CBS MarketWatch
Last Update: 11:09 AM ET Feb 4, 1999 NewsWatch
NEW YORK (CBSMW) -- Computer hardware stocks lost 2.6 percent Thursday morning, jolted by reports of a deteriorating semiconductor price environment.
The Philadelphia Semiconductor Index slid 3.1 percent after Merrill Lynch chip analyst Thomas Kurlak downgraded shares of Advanced Micro Devices (AMD) and decreased his 1999 earnings forecast for Intel (INTC). Kurlak cited Intel's aggressive pursuit of low-end PC market share for the price declines.
Intel tumbled 6 9/16 to 132 1/4, while AMD lost 2 15/16 to 18.
Kurlak lowered his investment opinion on AMD to "neutral" from "accumulate," citing lower-than-expected average selling prices for the company's K6 microprocessors in the current quarter. Kurlak expects average selling prices for AMD chips to be the same or below the $89 level reported in the fourth quarter.
Kurlak attributed the declines to Intel's recent 40-percent price cut on its competing Celeron chip. "With AMD just beginning to increase production of its 400 MHz part, the timing of Intel's price change seems to be an issue," Kurlak said.
Intel didn't escape unscathed, however. Kurlak also lowered his fiscal 1999 earnings estimate on the company by 15 cents to $4.45 a share. Kurlak noted that the lower forecast reflects an average selling price of about $90, lower than the anticipated $100 price tag.
The semiconductor price scare pressured computer manufacturers amid renewed fears of a seasonal PC slowdown. Piper Jaffray analyst Ashok Kumar confirmed that slowing demand accounts for some of the chip price declines.
"Adding to the gravity of the situation, our channel checks indicate that K6-2 400 MHz based Compaqs, priced at about $1,500, are not selling well," Kumar said. He also noted that while Gateway plans to use AMD chips in PCs sold in Japan, those units will amount to less than 10 percent of Gateway's computer sales.
The negative sentiment drove shares of Dell (DELL) down 3 1/4 to 104 5/8, Compaq (CPQ), down 1 3/16 to 46, International Business Machines (IBM) down 2 3/4 to 172 1/2 and Apple (AAPL), down 1 1/8 to 39 1/16. Hewlett-Packard (HWP) shed 2 1/8 to 76 3/8 after PaineWebber lowered its rating to "attractive" from "buy
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