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

To: L. Adam Latham who wrote (110641)	9/21/2000 8:42:43 PM
From: vc21	Respond to of 186894

I agree Adam. Total over-reaction but that's how it is afterhours. Anyway, the houses were eating it up (esp MSDW, they don't want to miss any more quarters) Good luck

To: L. Adam Latham who wrote (110641)	9/21/2000 8:45:09 PM
From: Road Walker	Respond to of 186894

Adam, Good analysis, thanks. John

To: L. Adam Latham who wrote (110641)	9/21/2000 8:51:59 PM
From: andreas_wonisch	Read Replies (1) \| Respond to of 186894

Adam, Re: your analysis Two points: From (3) above, this decrease in gross profit will be offset by a $100M increase in interest income, so the resulting decrease in earnings, before taxes, would be $143M. The additional increase in interest income is included in the new revenue number. So you are counting it two times. (or to be exact: 1.62 times) Also Intel looked for gross margins in the 63-64% range. To be fair you should assume 63.5% gross margins. The tax rate is estimated at 31.8%, so the decrease in after-tax profit would be 143x.682 = $97.5M. You are forgetting that R&D is also up 100 million dollars from old guidance. Andreas

To: L. Adam Latham who wrote (110641)	9/21/2000 9:27:35 PM
From: Xpiderman	Read Replies (1) \| Respond to of 186894

Adam, Your analysis is perfectly right. Based on all available numbers, and assume 3% sequential growth, I see INTC will miss about 2 penny per share, no more!!! But the market is in its weakest stage in the cycle, so earning miss like this can cause serious damage to investor's confidence. Anyway, I will buy more sahres as soon as INTC stablized after openning madness. I did so in last several INTC warning, it works very well. Now my cost base is about $9. Good luck! -X-

To: L. Adam Latham who wrote (110641)	9/21/2000 10:18:14 PM
From: willcousa	Respond to of 186894

Adam, others have been saying this means 1 to 2 cents so you are right on with consensus.

To: L. Adam Latham who wrote (110641)	9/21/2000 11:02:37 PM
From: WTSherman	Read Replies (1) \| Respond to of 186894

<So unless I'm doing my math wrong, Intel appears to be getting punished by 33% from it's recent highs for a 1.4 cents/share shortfall in Q3. < At $60, the stock had a PE of 55, which for INTC is historically, extremely high. Whether its INTC or any of so many other pricey stocks they are all priced to perfection, no perfection and the balloon deflates pretty quickly. Wait until the full impact of $35 oil is felt this winter...

To: L. Adam Latham who wrote (110641)	9/22/2000 7:32:41 AM
From: kvkkc1	Respond to of 186894

Good work. I was too lazy to figure out the exact numbers, but I agree with your analysis.knc

To: L. Adam Latham who wrote (110641)	9/22/2000 4:49:29 PM
From: Diamond Jim	Read Replies (1) \| Respond to of 186894

Intel appears to be getting punished by 33% from it's recent highs for a 1.4 cents/share shortfall in Q3. Which would make me ask, Why did they even warn? jim

To: L. Adam Latham who wrote (110641)	9/23/2000 11:57:55 AM
From: NucTrader	Read Replies (1) \| Respond to of 186894

My Saturday morning newspaper doesn't give any #s, but states: "...after Intel warned that its third-quarter revenues will be far below expectations because of weak demand for PCs in Europe."

To: L. Adam Latham who wrote (110641)	9/23/2000 1:54:35 PM
From: Art Bechhoefer	Read Replies (2) \| Respond to of 186894

In addition to your essentially correct analysis, showing probably only about 2 cents below earlier expectations, note that a great deal of the problem in Europe stems from foreign currency translation losses, owing to the lower value of the Euro against the dollar. Thus, what is really overblown is the notion that somehow the market for Intel products is collapsing, or at least getting much weaker. The more accurate assessment would be that the market is changing, with less emphasis on PC's and more on hand held computers and other devices that involve newer technologies, such as digital wireless communications. While Intel's ultimate success can't be predicted accurately, at least Intel is making the necessary investments to participate in these new markets. Art Bechhoefer

To: L. Adam Latham who wrote (110641)	9/23/2000 3:55:30 PM
From: Exciton	Read Replies (1) \| Respond to of 186894

Adam, I agree completely. I did the numbers myself after the revenue warning came out and came to a similar conclusion--1 cent earnings reduction. In fact, there is an outside chance that Intel will still meet prior earnings estimates if the revenue numbers and investment income turn out to be slightly higher than current estimates. Quite frankly, I'm surprised that Intel can predict within 3 percent what their revenue will be for any given quarter. Another factor to consider is that demand typically accelerates the last two weeks of September. Regardless of whether it turns out to be a 0, -1, or -2 cent delta, a 1/3 reduction in stock price from recent highs is completely absurd. A great buying opportunity in my opinion.

To: L. Adam Latham who wrote (110641)	9/23/2000 5:17:47 PM
From: GST	Read Replies (1) \| Respond to of 186894

Adam: If we are talking about 2 cents shaved off earnings, you are right to ask what is going on here. Some possibilities: 1. Panic selling for no good reason; 2. Selling because of the magnitude of the shortfall -- clearly an over-reaction, or; 3. The magnitude of the shortfall is irrelevant -- only the change in direction and what it portends for the future matters -- and the message is "storm clouds on the horizon, get out of here now before it hits". Many observers want this to be seen as an INTC-only problem. If that is the case, happy sailing. But if INTC is signalling storm clouds on the horizon, take no comfort from those who say "no worries, there is nothing wrong with my boat now". They are missing the point.