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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: benwood who wrote (64618)	7/15/1999 12:48:00 PM
From: Thomas M.	Respond to of 132070

... They spend hordes on R&D ... That's exactly what makes the "earnings" numbers suspect. Tom

To: benwood who wrote (64618)	7/15/1999 7:13:00 PM
From: Fred Fahmy	Respond to of 132070

Ben, <BTW, 1994 to 1999 is only 5 years, why do you keep saying 6? > In the first post I said 5 years, then I changed it to 6 (just to confuse everyone <gg>). Actually, I guess it depends on whether you are referring to the number of years of earnings (i.e. 94, 95, 96, 97, 98, 99) or the number of delta's between years. Just semantics...our numbers agree. My choice of words was probably better the first time when I said 5 year CAGR. Sorry for the confusion. At any rate our growth rate numbers agree. <Your belief is that this slowing was due to other factors, and the natural slowing is going to happen much later -- that is, you expect growth to pick up again and stay in the 30% range for a while.> Yes, much, much later. But in the mean time I don't expect quite 30%, more like 20-25%. Some periods will be less than this range and some will be more. <I think the growth rate will remain lower as I feel umph is out of the PC revolution.> I think this is the meat of our disagreement. I think the PC/technology revolution is in its infancy....and overseas I think it is still in the womb, both in business and in the homes. Asia will be huge in the future. Even Europe is significantly behind the US. The internet in general and E-commerce specifically will grow exponentially fueling both low end and high end demand. Voice and multi-media applications will require more and more power. Increases in bandwidth will drive the need for more powerful PC's. Mobile applications are even further behind on the growth curve and hold enormous potential. In addition, I think in the future you will see Intel chips in applications that up until know have been reserved for mini computers and even mainframes. Finally, I believe Intel will be successful in expanding into complementary businesses. Of course, it won't all be smooth sailing, but I like what I see 5, 10 years down the road. <That said, I agree that Intel is an excellent very long term bet. They spend hordes on R&D and I expect them to try to capitalize successfully on many initiatives. At least, they will have one of the best chances of any major semi company. However, their current valuation is too high for my blood.> Good to hear that you aren't one of those who try to minimize Intel's excellence. Valuation?? Everyone has their own criteria. My year end target has been 80 since January. If the stock was at 80 right now I would consider it ahead of itself. My premiss, which I am very comfortable with is that over the long term (despite short term periods of over valuation and undervaluation), INTC will continue to outperform the vast majority of equities. I am not compelled to try and time these fluctuations. Rather I will continue to hold until I see a fundamental sift in Intel's prospects. As I see it now, Intel is better positioned than ever to take advantage of the future opportunities that will be presented as the global technology revolution expands. I love the long term risk/reward ratio of this stock. Good luck, FF