Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: E_K_S who wrote (42980)	6/11/2011 12:57:45 AM
From: Jurgis Bekepuris	Read Replies (1) \| Respond to of 78741

INTC - His DCF calculation is correct though the article is very confusingly written. Just in case it is not clear, the whole $34.30 valuation hinges on the 11.3% annual earnings growth rate for 5 years, which IMHO is optimistic. 11% discount rate (or your estimated return) is a bit low, but that's a personal choice for any investor.

To: E_K_S who wrote (42980)	6/12/2011 6:55:29 AM
From: Madharry	Read Replies (1) \| Respond to of 78741

i dont know what the actual numbers are but I am willing to make a small wager that intel's earnings in year 5 will be less than projected by this model. i would also point out that most of the value seems to be in the disposal value of $20+ dollars which assumes that the growth of the previous 5 years somehow continues. or at least so it appears to me. now my guess is that that this model doesnt take into account that the desktop pc model is probably in decline and likely to experience sales declines in coming years, the growth areas appear to be in mobile and tablets where intel is weak. I dont think the intel of the present is the intel of the past. On top of that someone here made a very astute analysis in the past of how with tech companies you cant believe the earnings because of the impact of stock options. this model completely ignores that issue.