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Technology Stocks : Advanced Micro Devices - Moderated (AMD) -- Ignore unavailable to you. Want to Upgrade?

To: Charles R who wrote (14741)	10/17/2000 9:06:58 PM
From: Joe NYC	Read Replies (2) \| Respond to of 275872

Chuck, I agree - have been saying this for a while. Intel will use the spare capacity to ramp chipsets and P4. On chipsets, great, can't wait, bring them on. On P4, it could be problematic for AMD. Intel will gladly sacrifice gross margins, gladly spend $100 to build these things, as long as Intel can recapture / get competitive in the high end. Joe

To: Charles R who wrote (14741)	10/18/2000 12:39:26 AM
From: jamok99	Read Replies (1) \| Respond to of 275872

Charles, <<The problem seems to be the street seems to be completely blind to what is going on.>> True, but as long as perception remains king over fundamentals, stocks will move in accordance to perception, and for better or worse, analysts shape and communicate that perception. The reaction of analysts to INTC's CC speaks volumes about what that perception is: From the newswire story on the CC: <<Executive Vice President Paul Otellini told investors and analysts on the conference call to expect Intel to get more aggressive with pricing in certain portions of the microprocessor market, implying that AMD's market share gains against Intel had gone as far as it would like. While some, including Peck expect, an all-out price war between Intel and AMD the rest of this year and into next, Niles argued that because Intel competes mainly against AMD in the consumer market, which accounts for about 30 percent of microprocessor sales, any price war would hurt AMD more than it would Intel, which sells its chips also into the corporate and computer server markets.>> In some senses, it doesn't matter at all that the above interpretation includes some astounding FUD. It not only becomes reality, it becomes a self-fulfilling reality, as we have seen so many times before: AMD's share price moves with Intel, or more correctly, with the 'spin' of perception that the analysts put on any news. I'm no longer sure that there is a way to change this perception problem without really outstanding, flawless execution by AMD, with a lot less room for 'spin' of the facts, which may be beyond their capabilities. To those who say we can't have a stock with a PE of six or eight, consider the most pessimistic scenario: AMD price continues to be suppressed by some combination of less than ideal execution/perceptual problems/analysts spin until we are, in fact, in sight of a bottoming in the semi-conductor cycle. At which point the line becomes:"Yeah, stocks with PE's below 10 are traditional for the bottom of the cycle - it's correctly priced". I hope this gloomy a scenario does not come to pass - but I think that those who believe that AMD can't languish for a long period of time at these levels have too readily dismissed one plausible scenario. As usual, just my 2 cents. I'm not selling here, but I'm not buying either.