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Technology Stocks : Intel Corporation (INTC) -- Ignore unavailable to you. Want to Upgrade?

To: Michael Bakunin who wrote (92808)	11/18/1999 12:18:00 PM
From: Tony Viola	Read Replies (3) \| Respond to of 186894

mb, Re: "Say Intel grows revenues and earnings at 20% until its revenues represent 5% (!) of total GDP. Then Intel grows with GDP, at 5% nominal per year. Discount at 12.5%, and Intel is worth $200 B. -mb" Is this some new kind of law of economics. Guess I'd better retake ECO 101. LOL! I can't speak for you, but I noticed from a brief tour of the M. Burke thread recently that AMAT is another one of his, forget how he put it, but something like, no-brainer or automatic put candidates. I mean when do the naysayers of the best high tech stocks just throw in the towel? Kind of like betting against the NY Yankees the past 4 years. Tony

To: Michael Bakunin who wrote (92808)	11/18/1999 12:21:00 PM
From: Robert Douglas	Read Replies (2) \| Respond to of 186894

Say Intel grows revenues and earnings at 20% until its revenues represent 5% (!) of total GDP. Then Intel grows with GDP, at 5% nominal per year. Discount at 12.5%, and Intel is worth $200 B. -mb Michael, I don't mean to insult but that is the most nonsensical attempt at valuation I have ever seen. For starters GDP is around $9 trillion. 5% of this would be $450 billion in revenues - an absurd number even for the most bullish INTC shareholder. My estimates are $5 EPS in 5 years and a P/E multiple of 30 to 40. Discount to the present at 10% (a high discount rate, IMO) and you arrive at a present value between $93 and $124.

To: Michael Bakunin who wrote (92808)	11/18/1999 8:44:00 PM
From: Amy J	Read Replies (2) \| Respond to of 186894

Michael, RE: "Say Intel grows revenues and earnings at 20% until its revenues represent 5% (!) of total GDP. Then Intel grows with GDP, at 5% nominal per year. Discount at 12.5%, and Intel is worth $200 B. -mb" Hi Michael, I think that's an excellent post. It appears you are highly skilled in mathematical modeling, and sometimes smart people get laughed at for intelligent comments which challenge the status quo. You're approach is a top down approach. I did a bottom up approach (where I counted the size of the markets and assigned an estimated number to Intel's portion) and came up with numbers which indicate Intel is undervalued for its future long-term (>1yr) opportunities. However, for the nearer business opportunities, I had said sometime last February, I see Intel at 200 (pre-split) in 2000, which would be 100 in 2000. However, your top-down approach intrigues me. When you correct your GDP figure, what do you get? Amy J