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

To: Amy J who wrote (102267)	4/13/2000 1:00:00 AM
From: carl a. mehr	Read Replies (2) \| Respond to of 186894

Amy, Re: <<Does anyone know where Paul is? >> We probably should ask him. His last post was on April 4: Message 13343793 I plunked down a few bucks on Intel prior to the closing bell. I sure hope that Intel has super earnings like AMD, but we need to hear from Paul...humble carl

To: Amy J who wrote (102267)	4/13/2000 7:45:00 AM
From: GVTucker	Read Replies (3) \| Respond to of 186894

Amy, RE: Harry, on your analysis, what do you conclude is a reasonable price if Intel achieves a growth rate of 35% in 2000, followed by say 35% in 2001? Then 25% in 2002, then 20% 2003? Just wild guesses here, but I bet Intel will be above 20% growth in 2000. I think the analysts could be wrong on their estimates for 2000, given Craig Barrett's recent comments in that article. That's a highly optimistic scenario, as you well know, although you guess that analysts are wrong on 2000 is pretty well acknowledged by most everyone, including the analysts. If Intel achieves those growth rates, then the company will earn $6.38 in 2003. If you further assume a 15% long term growth rate at that point (also pretty optimistic), then figure that the increased size has given Intel a lot more ability to produce more predictable returns, a PEG of 3x is possible, leading to a PE of 45, or a stock price of $287 in 2003. Discount that back at whatever fair rate you like. If you discount that back at 15%, a reasonable price today is $204.

To: Amy J who wrote (102267)	4/13/2000 9:31:00 AM
From: Road Walker	Respond to of 186894

Amy, re: Intel's earnings growth The good news is that we are in cyclical upturn in sales, the great news is that GM's are increasing on increasing sales, the only bad news is that capital spending will have to increase to meet current/future demand. Traditionally most capital intensive cyclical industries are awarded lower PE's. John

To: Amy J who wrote (102267)	4/13/2000 1:34:00 PM
From: Harry Landsiedel	Respond to of 186894

Amy J. Re: "what do you conclude is a reasonable price if Intel achieves a growth rate of 35% in 2000, followed by say 35% in 2001? Then 25% in 2002, then 20% 2003?" Good point. Intel's growth is not linear. But history suggests that several years of strong growth are followed by at least one year of "consolidation". EPS growth rates since '92 are: 92: 31%, 93: 105%, 94: 14%, 95: 35%, 96: 33%, 97: 33%, 98: -11%, 99: 35%. So I agree with GV Tucker that your scenario is optimistic. Assuming that the 20% growth rate extends out to 2005, the average growth rate of your scenario would be about 24% and the return would be around 19%, an excellent achievement. Hope this helps. HL