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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Proud_Infidel who wrote (20568)	6/18/1998 6:40:00 PM
From: Teri Skogerboe	Respond to of 70976

Lehman on INTC, dated 06/05/98... Headline: Intel Corp: INTC Price Cuts Due This Weekend; What to Expect Author: M. A. Gumport, CFA 212-526-5368 Rating: 3 Company: INTC Country: COM CUS Industry: SEMICO Ticker : INTC Rank(Prev): 3-Neutral Rank(Curr): 3-Neutral Price : $69 3/8 52wk Range: $102-67 3/8 Price Target:$ 75 Today's Date : 06/05/98 Fiscal Year : DEC ---------------------------------------------------------------------- EPS 1997 1998 1999 2000 QTR. Actual Prev. Curr. Prev. Curr. Prev. Curr. 1st: 1.10A 0.81Ax 0.81Ax 0.85E 0.85E 0.85E 0.85E 2nd: 0.92A 0.70E 0.70E 0.87E 0.87E 0.92E 0.92E 3rd: 0.88A 0.76E 0.76E 0.88E 0.88E 0.88E 0.88E 4th: 0.98A 0.88E 0.88E 0.90E 0.90E 0.95E 0.95E ---------------------------------------------------------------------- Year:$ 3.88A $ 3.15Ex $ 3.15Ex $ 3.50E $ 3.50E $ 3.60E $ 3.60E Street Est.: $ 3.15E $ 3.14E $ 3.83E $ 3.77E $ - -E $ - -E x-1Q98 excludes $-0.09 in process R&D write-off for acquisition. ---------------------------------------------------------------------- Net Cash per Share* : $6.70 Revenue (1998) : $26.2 Bil. Return On Equity* : 32.6 % Proj. 5yr EPS Grth : 10.0 % Shares Outstanding(z): 1785.0 Mil. Dividend Yield : 0.2% Mkt Capitalization : $123.8 Bil. P/E 1998; 1999 : 22.0x; 19.8x Book;Price/Book : $12.83/sh;5.41x Convertible : None Disclosure(s) : C Puts in Equity unexercised; z-Share equivalents ---------------------------------------------------------------------- INCLUDED IS OUR INTC PRICE LIST EXPECTATION. PRICE CUTS HAVE BEEN SCHEDULED FOR SOME TIME, AND THE NEXT CUT IS DUE 6/7/98. BUILD TO ORDER MODEL IS TAKING HOLD OF THE ENTIRE ELECTRONICS INDUSTRY, AND IT APPEARS THAT INVENTORIES HAVE NOT YET BEEN CLEARED FROM THE CHANNEL. THESE CONDITIONS WILL CONTINUE TO SLOW ORDER TRENDS IN THE SHORT-TERM. CAUTIOUS ON CHIP STOCKS IN GENERAL SHORT TERM AND X86 TRENDS IN PARTICULAR. ---------------------------------------------------------------------- INTC PRICE LIST. Contrary to press reports yesterday that an unexpected price cut is due 6/7, the price cut has been anticipated for some months and a price list was sent out to customers weeks ago. That said, we do anticipate an ongoing aggressive price strategy (for instance, the Pentium 2-300 should go from $375 to $305) and remain very concerned by the tenor of the PC market. In particular, one of our most respected sources has indicated that Dell now intends to move from a 7 day inventory model to a 4 day inventory model, and that a build to order model is taking hold of the entire electronics industry. We are not persuaded that inventory has yet been cleared from the channel sufficiently to allow near term better order trends during the seasonally slow summer. We are cautious on the impact of Japanese weakness, and we are particularly cautious on the competitive situation of the microprocessor market. Distributors routinely refer to this segment as the commodity microprocessor business.** We view our INTC EPS projections as somewhat optimistic. {Table Here for LB Sales} ---------------------------------------------------------------------- Disclosure Legend: A-Lehman Brothers Inc. managed or co-managed within the past three years a public offering of securities for this company. B-An employee of Lehman Brothers Inc. is a director of this company. C-Lehman Brothers Inc. makes a market in the securities of this company. G-The Lehman Brothers analyst who covers this company also has position in its securities. ------ PS. Emphasis added is mine. ts