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

To: dougSF30 who wrote (245518)	1/5/2008 1:50:47 PM
From: Sarmad Y. Hermiz	Read Replies (1) \| Respond to of 275872

>> Given that a large drop over the past week or two was also experienced by AMD, STX, etc, I'm not sure how much of the drop one can attribute to Intel-specific causes, << I think fund managers now have seen for several years that PC sales slow down in January, and PC stocks do not do well. There were signs before year end that this year will be different. That demand has taken a step up, and the seasonal pattern will not hold. The two downgrades were very targeted at saying the seasonal slowdown will occur, and that it is a mistake to think this year is different. Therefor fund managers panicked and sold all PC related stocks. I am assuming that even if PC's slowdown, there are factors that will keep Intel's shipments and revenue above the seasonal trend. They are: 1) Demand is stronger than anyone had thought. It is strong enough to have absorbed Intel's enormous excess inventory that was present from q3 '06. That inventory was gone in 3 quarters. I think the excess inventory in q3 '06 was equal to a quarter's production. That it was used up in 3 quarters means demand is 130% of what it used to be 2 years ago. And Intel's capacity has not kept up with that level of demand. Intel had been living off its inventory. The inventory is gone. All of Intel's production capacity will be needed to keep up with the new level of current demand. the analyst who thinks different is just plain wrong. 2) AMD has only 2/3 of its usual production capacity. There will not be a price war. AMD will barely keep up with a diminishing share, anyway. They do not have parts to give away, even if they wanted to. 3) With $100 oil, lots of emerging economies are demanding PC's and other goods. Even if Acer's sales in Europe slow, sales are speeding up everywhere else. And Acer is what ? 5th rank with 5% sales share. Who the heck cares about Acer, and limited to Europe consumer market? That is maybe under 1% of total sales. And who knows, maybe the Acer computers that are not selling are AMD based. Just like Dell and Toshiba.