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

To: puborectalis who wrote (82625)	6/3/1999 3:14:00 PM
From: John Hull	Read Replies (5) \| Respond to of 186894

OK (deep sigh, as I re-enforce my tolerance) First of all, the stock closed at $35 a share on June 1, 1997. $35 to $51 equals a 45.7% APPRECIATION and just slightly BETTER THAN the S&P500 over the same period. Now, you may ask, why hasn't it done even better? (suspend for a moment the tough-to-please nature of the question) Well, during that time period a few things have happened: 1. Global oversupply of DRAMs (check out the revenue trends of the next five largest semi companies in the world over '97-'98 and Intel looks comparatively stellar) 2. Shift in average Computer System ASPs not fully offset by volume elasticity. 3. Internet became the killer app. Software/MIPS spiral now added new constraint of bandwidth for most consumers. This is getting fixed, but did have an effect on the demand curve. Notably, this is not a big problem in corporate market. 4. Market segment share loss to a competitor - give AMD some credit, their method may have turned out to be a giant wealth destroyer overall, but they did succeed in taking some share. 5. Slow down in Asia, formerly our fastest growing geography - slowed our sales momentum and earnings growth. We were not the only ones. 6. Turnover in our IR department Now don't forget that only a few months ago the stock was at ~$70+ which meant a pretty sizeable return. Please also don't forget that SUNW, MSFT, AOL, DELL, EMC, GTW, COMS, ORCL, CPQ are also trading well off their most recent highs. You can ask them all why. Sorry if I'm somewhat unsympathetic, these Q1-Q2 pullbacks in Intel stock are getting pretty familiar to me. As are the questions and concerns. I'm in this for the long-haul. Keep the faith, jh