Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

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

To: Paul Engel who wrote (103976)	6/5/2000 2:20:00 AM
From: Elmer	Respond to of 186894

Re:"Re: "Will AMD see a selloff tomorrow?" No - Cherry Sanders is making 1024 TV appearances tomorrow to assure every TV anchor person that AMD is headed to the moon." I thought that was NiceGuys job.... EP

To: Paul Engel who wrote (103976)	6/5/2000 3:05:00 AM
From: Scumbria	Respond to of 186894

Paul, AMD has a problem From the AMD thread ;^)) Clock for clock the Thunderbird is generally faster than the Pentium III on all of its official platforms (BX, 820, 133A) .... If you compare the Thunderbird on a KT133 motherboard to a Pentium III on a VIA 133A motherboard you can see that the Athlon holds a large advantage over the Pentium III... there is no question that the Duron will end up dominating the low end market where Intel's Celeron has failed to perform as well as we expected. anandtech.com Scumbria

To: Paul Engel who wrote (103976)	6/5/2000 10:06:00 AM
From: Eylon	Respond to of 186894

The case for AMD as the next big one. We are all looking for the next big gainer. The one stock that one year from now we will say to ourselves how on earth did I missed such an obvious one? I think that AMD has a very good chance of being that stock in the next year(s). I see three good reasons for it. 1. The DOJ vs. Microsoft I think that the DOJ peoples are out of their mind in this case, but it is not what I think but what the DOJ think. This case should put a real scare into any gorilla out there. You cannot compete fiercely if you are the #1 in your field. Any large dominant company that holds a large part of the market (read Intel in this case) cannot even give the impression that they try to force a smaller competitor out of business. Intel realized this point a lot earlier than Microsoft and settled its case with the government last year instead of fighting (and losing 54% of its value) as Microsoft did. We already have seen the results of this case where Intel rate of price-cutting has slow down dramatically. These price reductions can be seen as a way to force the smaller less solvent company (AMD) out. Notice that both Intel and AMD will benefits from this increased ASP. The only loser is the consumer who is going to pay higher price for CPU 2. AMD is doing better Unlike the last 20-25 years AMD is actually having good products now. As an Intel admirer and investor I must admit that the Athlon is faster than the Pentium. Just today AMD introduced an improved Athlon with copper which give it some head start on Intel. With better products come more respectability and I expect to see the top of the line Athlons in high-end servers soon. That means better ASP and better margins. 3. Intel is having some problems Recently, Intel starts to have some problems. Missed deadlines, chipset problems, and strained capacity. Nothing terrible but not the great execution we were used to see and expect. Intel is still the gorilla of the CPU field. It is an innovating force and the new Itanium should be a great processor. AMD is still a copycat company that is good at reverse engineering Intel processors. Unfortunately for Intel, the gorilla game has changed thanks to the DOJ. Being the innovator bring higher R+D overhead and lower margins. A company like AMD can do very well if it can reverse engineers any new and successful new processor and be in the market when the demand for this product is high. Intel cannot fight back because of the DOJ threat. In this business climate it may be better to be the second fiddle. The last projections I have seen were for AMD to make about 25% of the processors that Intel makes. These projections look to be too low for AMD, considering Intel latest problems and AMD smooth execution. In my opinion, AMD making 30%-40% of the Intel production number, seem to be more reasonable. Since the new Athelons should be cheaper to make than the older ones, I expect similar ASP and margins for the two companies. The present capacity problem at Intel and the very long lead time for new fab plants ensures that AMD will be able to sell all of its processors at good prices in the near future. Last I have checked Intel market capitalization is about 450B and AMD is about 14B. Intel business is booming and with the higher prices for its processors (fewer price reductions) another 20% increase in the next year looks reasonable. That will put Intel at about 550B market capitalization with $160-$170 stock price. AMD on the other hand, is greatly undervalued for these new circumstances. If AMD will have the profit potential of 30% to 40% of Intel it should be valued at least at 20% of Intel or 110B. This is eight times higher than the current valuation. I realize that the two companies make money on other thing like flash memory, communication, and investment, but the CPU business is the cornerstone of both companies and can be used for comparisons. Bottom line: AMD may be the next big thing and I expect it to be a multibager for this coming year. Disclosure: Last week I bought options and leaps of AMD and I intend to buy more. Eylon