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 : The Financial Collapse of 2001 Unwinding -- Ignore unavailable to you. Want to Upgrade?

To: Elroy Jetson who wrote (9551)	10/12/2022 8:35:16 PM
From: E_K_S	Read Replies (2) \| Respond to of 13801

Re: INTC Check out the MOBLEYE IPO specifically page 80 of their S1. INTC will receive $3.5 Billion in payment of a note MOBLEYE took earlier in the period when INTC first acquired the company in 2017 (for $15 Billion). The $3.5 Billion note works out to be $0.85/share and represents about 65% of their annual dividend. When they IPO MBLY, they estimate it will be done at $30 Billion and INTC will still own Class B shares (w/ 10x the vote of Class A shares) and those Class B shares may/could represent 50% ownership (depends on how many IPO Class A shares are sold). If you annualize Mobileye's revenues so far in 2022, and then multiply that ($1.7 billion) by 21, the multiple Intel paid, you get a valuation of nearly $36 billion. This is almost 2.5 times higher than what it paid five years ago To me MBLY is a hidden asset for INTC. They doubled their investment in less than 5 years and once the IPO is completed later this year, they will still own 50% of the company (Class B shares) and received $3.5 Billion payment for their Note. MBLY only accounted for 3% of INTC's Revenues. The IPO makes good sense and they can deploy the capital into their new Fabs they will be constructing in Ohio. ------------------------------------------------------------------- I did listen to a recent podcast w/ the CEO (about a month ago) and the question came up on why pay a dividend w/ all the new capital investments they have planned in the next 5-7 years? He said they looked at everything and determined that the current dividend is/was preferred (and at that time it was raised I believe). Circumstances change but since then the CHIPs Act passed and INTC s/d receive $10 Billion in tax credits over that 7 year construction period for their Ohio project.