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Technology Stocks : Semi Equipment Analysis -- Ignore unavailable to you. Want to Upgrade?

To: etchmeister who wrote (27978)	1/18/2006 8:57:47 AM
From: Return to Sender	Read Replies (1) \| Respond to of 95456

08:46 am Intel (INTC) 23.15: A trifecta of technology-related earnings results hit the wires after the bell on Tuesday. The market went in expecting a record revenue quarter from Intel, but instead the chip giant not only missed estimates by three cents, but also lowered forecasts. The market reacted swiftly to this clearly disappointing quarter, with the entire Street taking down estimates and several firms lowering expectations. Intel's debased forecasts cast a shadow over the entire semiconductor industry, sending tech stocks lower from Asia to Europe. Intel, which makes 80% of the world's processors, posted quarterly profits and revenues below expectations, as the chipmaker suffered from weaker demand for desktop processors. This news also sent shares of the number one PC manufacturer and Intel's largest customer, Dell (DELL), lower, along with Apple Computer (AAPL). Intel acknowledged it lost market share to rival Advanced Micro Devices (AMD) in the quarter, punctuated by weaker than expected holiday demand. The bright spot was the continued robust growth in servers with the Opteron. Net income rose 16% to $2.45 bln, or $0.40 per share, from $2.12 bln, or $0.33 a year earlier. Sales rose 6.3% to $10.2 bln. Analysts had expected a profit of $0.43 and revenues of $10.56 bln. Intel magnified the downside by lowering guidance, which is sure to cause an abrupt halt to the recent rally in the SOX Index, which is up 8.1% to date. Intel's forecasts included higher expenses and a higher tax rate. It anticipates first quarter revenues of $9.1-$9.7 bln - the midpoint of the guidance would represent an 8% sequential decline, which is more than the seasonal decline of 5%. Intel also stated it would no longer provide mid-quarter updates. The market was anticipating a strong quarter for Intel. These results were a huge disappointment with a slew of issues from market share losses, lingering capacity constraints, and weaker PC demand, all playing their part. Shares will likely take a considerable hit. Still, don't count Intel out just yet. We'd argue longer-term investors should take advantage of considerable weakness (i.e. low $20s) as Intel now becomes a second half 2006 story. Intel's fate rests on the success of its new products, including new dual-core processors which are hoped to spark renewed demand for desktops, along with new digital consumer products, and Intel's new 65-nm process technology. Shares are trading at 15.6x forward earnings compared to AMD at 75.9x. --Kimberly DuBord, Briefing.com biz.yahoo.com