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

To: MrCash who wrote (48414)	2/22/1998 3:05:00 PM
From: Paul Fiondella	Respond to of 186894

If you look at the tables you posted There is no correlation historically between return on assets in that table and P/E ratios. So your argument requires a more detailed breakdown of what constitutes an asset under the meaning of our analysis --- namely is the plant's value marked down to reflect its obsolescence or is it carried forward at an inflated asset value. Also as Joey points out the intangible assets for software companies are the value of its intellectual property---very different than for hardware companies. Are those figured into the MSFT table? As for a company to start in a garage and compete with MSFT well you left out the intellectual property --- unless it steals MSFT's intellectual property. Something which might happen in the future if the Federal Courts interpretation of copyright laws moves against the owners of intellectual property. And it doesn't matter if MSFT moves from distributing its products on CDROM to the Internet or increases or decreases their cost of production since they are not in the manufacturing business. What we really need is a table showing how long it takes Intel to get a return on its capital investments, what a decline in demand might do to to that expected rate of return, and how quickly those assets go out of production and have that reflected on the books. PS I'm no expert in accounting methods for depreciation but perhaps you are. =============== Incidentally what MSFT does with its capital is acquire more intellectual property.