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

To: Carl Quigley who wrote (48534)	2/23/1998 12:24:00 PM
From: Barry A. Watzman	Respond to of 186894

Actually, I don't feel that the current runup is due to early anticipation of Merced. I think it's mostly just putting things back to a point from which they should never have left in the first place (e.g. INTC at 100 +/-). What happened in the past 4 months was uncalled for, an extreme over reaction to news far less significant than was perceived at the time. If you bought then, you did great, because it was the classic buying opportunity. Unfortunately, I had some INTCW on margin in one account and had to sell to prevent a margin call, so I am coming back with fewer shares than I had (only 200 shares fewer, however). Also, my wife converted some of her INTCW to INTC in December, which, as it turns out, was way too early, so there are fewer shares in that account as well. As for the current runup, I think -- I've posted this previously -- that there is a TREMENDOUS amount of computer upgrading of the installed base that has started and will be going on throughout the year. This has been brought on by the lower prices, and by the fact that there are still a tremendous number of 486's, and even earlier models, that are finally being replaced (and we are talking something like half of the installed base, perhaps 40 million systems in the US alone). I think that results for this year will surprise very slightly (10%-20%) to the upside, mostly later in the year, and I think that the analysts are increasing low on their estimates for the next two years, to the point where I believe that they are 100% off by 2000 (e.g. I'm looking for $10/share, not $4-$5). I also think INTC is given WAY to low a P/E, and I don't buy any of the "capital intensive" hogwash that you hear as the "reasons" for this. It should be 25-35 given what other comparable (and lots of less-than-comparable) stocks are going for. But it is a mass-psychology issue, and it won't change overnight.

To: Carl Quigley who wrote (48534)	2/23/1998 1:41:00 PM
From: Mike Wong	Read Replies (2) \| Respond to of 186894

qquig, Dont ignore the super high volume, low margin, low end market, where PCs power everything from your refrigerator to your cell phone. As Grove said "...billions of interconnected PCs..." Intel made a major move into that territory today. quicken.excite.com ry/?story=/news/stories/bw/19980223/a0227.htm I believe that market comes with lower risk, and equally high profits (as Merced) for Intel. While I'm as hopeful as you are that Intel will capture the workstation market with Merced, the question is whether existing software will run on Merced without at least a recompilation. As you may remember, Intel had another super chip a few years ago (I believe it was a 8XXXX) that went absolutely nowhere. On the positive side, this time around, I believe Merced has more management focus, and the market is also more ready for it. The market "volume" for low cost, low power chips to power every sort of appliance is 2 orders of magnitude bigger than desktop PC's. For that market, it is not even an issue whether software is already running on it. There isn't any. The most important thing to be successful in that market is the ability to produce quality chips at the lower cost. The economies of scale, and the huge investments needed to achieve those economies favor Intel. The second and third most important things to succeed in the appliance chip market is technology and marketing channel. IMO, whatever Intel does not already have there, they can buy. Same as Cisco. Happy investing.

To: Carl Quigley who wrote (48534)	2/23/1998 3:47:00 PM
From: carl a. mehr	Read Replies (1) \| Respond to of 186894

qquiigg, RE:<<doubled up on the recent dips, Feeling pretty smart right now and I have a good feeling that I will be alot happier in a couple more years. This is in no small part to you and many others on this thread with your voices of calm during all the volatility the past 12 months>> You are welcome! This is like shareware on the honor system, and we only charge 10% of your profit. What a deal! humble carl

To: Carl Quigley who wrote (48534)	12/17/1998 12:29:00 PM
From: Carl Quigley	Respond to of 186894

Is the PC Dead? Not Even Close FORTUNE corners five CEOs at Comdex to ask about the dirge for PCs. Their verdict: Sales will only get stronger. David Kirkpatrick The Comdex computer trade show in Las Vegas is a giant, sprawling, chaotic mess, but it's a great place to get a read on the personal computer business and to check the industry's pulse. Lately industry magazines and the Wall Street Journal have been saying we may be entering a "post-PC era," dominated by hand-helds and various network-connected devices. Braving logistical nightmares unique to Comdex, I collar the CEOs of five of the top ten U.S. PC companies--including Compaq's Eckhard Pfeiffer, Dell Computer's Michael Dell, and Gateway's Ted Waitt--to see if they too feel that the end of their era is here. What I hear, in an assortment of coffee shops, meretriciously decorated hotel suites, and closet-like meeting rooms, is extraordinary and unexpected optimism about the growth potential in this business. Here's the deal: Forget that era-change stuff. The PC will be with us a long time. PC sales, which have picked up recently, are getting even stronger. However, only the biggest companies will benefit. The weak will shrivel as consolidation continues and lower PC prices allow only the most efficient manufacturers to prosper. Making PCs easier to use is a mantra that's approaching obsession-like fervor in the industry. Executives have concluded that such improvements are critical to sustain the industry's growth long term. I catch up with Michael Dell in an out-of-the-way bank of cubicles in the Las Vegas Convention Center. He thinks the idea that we're entering the post-PC era is absurd: "That's nonsense. Just because you have growing interest in hand-helds doesn't mean full-function computing is going away." It turns out to be the only subject on which he and archrival Eckhard Pfeiffer of Compaq agree. "I think the PC will continue to be around for a long, long time to come," says Pfeiffer. "We see a new range of products evolving around the PC, but it's not going away." Sure, everyone professes admiration for the incredible success of 3Com's PalmPilot hand-held organizer, which synchronizes easily with a PC. But Gateway CEO Ted Waitt, whose comments I can barely hear over the booming bass line of trade show music, makes clear why this isn't a threat: "The reason the PalmPilot was successful is because it was an add-on to the PC, not a replacement." He says that the PalmPilot is just the start of a larger trend toward a wide variety of non-PC Internet appliances. "Will they kill the PC? No." So how far will this trend go? Waitt sees the home PC possibly turning into a server that coordinates a variety of simpler single-purpose devices. At his booth, Teruaki Aoki, president of Sony Electronics, says his company entered the PC business in part for that very reason. "The PC will be the hub for all the entertainment equipment for Sony," he explains. The server concept also appeals to Intel, says spokesman Howard High: "The PC is the ultimate Darwinian device. This is just another opportunity to evolve into a new life form." One possible future life form: Intel executives are talking about a device they call the "fridgetop," which will allow family members to exchange messages in the kitchen. New devices may eventually help PC makers get into more than the 40% of American homes they currently inhabit. In the short term, however, the key may be making PCs easier to use. Industry leaders suggest part of the problem is Microsoft's operating system. Many say it's a large obstacle in providing consumers with a better experience with PCs. Helping customers with questions and problems about Windows costs Gateway "hundreds of millions of dollars a year," Waitt explains. Execs praise the hot-selling Apple iMac for its simplicity. Says Alain Couder, who runs struggling Packard Bell NEC: "Its ease of use is unmatched by Windows 98, and that's a challenge for us working with Microsoft." Microsoft CEO Bill Gates at least acknowledges the problem. He spends much of his show-opening keynote speech--which I catch on a video monitor from a crowded adjacent room--talking about bringing "simplicity" to PCs. Microprocessor-king Intel realizes this too. In its meeting room, Intel touts a prototype PC that can be turned on in 25 seconds, about one-third the time a typical machine takes today. PCs not only have to be easier to use--they have to get simpler to buy for consumers and businesses. The week before Comdex, market leader Compaq roiled the industry by announcing a major change in its distribution strategy. It will offer small and medium-sized businesses the ability to buy its PCs over the Internet or by phone--as well as from dealers and resellers. Says CEO Pfeiffer: "Last week's announcement was the clear public message that Compaq is going direct." I arrive at my meeting with Michael Dell coming from Pfeiffer's keynote. Compaq had handed out box lunches sporting its logo; when Dell sees mine, he promptly offers to eat Compaq's lunch. He belittles Compaq's move, boasting about his company's 66% growth in PC shipments last quarter. "Compaq's offering a portion of its product line to a portion of its customers in a couple of geographies," he says. "We beat them in every customer satisfaction award and grow several times faster." Replies Pfeiffer, whom I see a half-hour later: "I admit that the direct model has done a lot for Dell. That's the only thing the company has ever really accomplished." He says Compaq is better than Dell at serving larger enterprises because of the service capabilities it acquired earlier this year when it bought Digital Equipment. "Let's see what they will come up with to compete in that space as we match their direct model," he taunts. I'm so struck by the animosity between these two guys that I ask them to debate each other. They say yes. Watch for the fireworks here soon. -http://www.pathfinder.com/fortune/1998/12/21/pc.html