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

To: John F. Dowd who wrote (166825)	6/22/2002 10:21:43 AM
From: Dan3	Read Replies (1) \| Respond to of 186894

Re: what would it take in terms of capitalization to build a new INTC from scratch? Spend $2.8 Billion to buy AMD (its current market cap) and get AMD's FABs and flash and CPU tech and licenses. Spend another $12.5 Billion for 5 brand new, 300mm FABs to bring the total capacity of AMD and AMD's share of FASL up to what Intel has. Total - about $15 Billion. We should probably add in another $10 Billion for the development FABs, software teams, etc. Intel's current market cap: $128 Billion. So the replacement cost argument leads to a share price of about $3.50 (I am quite sure it will not go that low!) It's interesting to do the same exercise for AMD: Market cap of $2.8 Billion, with Dresden worth about $2 Billion, Austin worth about $1 Billion as a flash FAB, and half owernership of the FASL operation worth another $1.5 Billion. Add in another $1 Billion for AMD's development fab and other operations, and you get a replacement cost of $5.5 Billion - double the current market cap. Should Intel be selling for $3.50 and AMD for $17? No, but it's an interesting exercise.

To: John F. Dowd who wrote (166825)	6/22/2002 12:45:53 PM
From: kapkan4u	Read Replies (2) \| Respond to of 186894

<Probably going into short US Treasuries. Notice the yield curve steepening.> Selling US stock and buying US Treasuries would be neutral for the US$. Yet it is dropping like a rock. So the money is flowing away from the US$, probably into local bonds and money markets. <Tell me what would it take in terms of capitalization to build a new INTC from scratch?? > I have said before that I would consider buying INTC at around $8. But to go long I would also like the see the business model and management changed: 1. They should get out of the most of the communications IC business, except Xscale. 2. They should cancel IA-64 and accelerate Yamhill. 3. They should go after foundry business against UMC and TSMC. Kap