Groovy Stocks article on Intel Corporation

Posted on March 23, 2006 , filed under Stocks | Print This Post

I caught an excellent article written on February 27th, 2006 by Groovy Stocks.com, that mirrors many of my own thoughts about INTC, Intel Corporation.

Here is a quote from the article:

A lot of people are worried about the AMD threat. We think these worriers have gotten used to having it too good. Might AMD win market share from Intel? It sure might! But who doesn’t have competition? UPS has FedEx, General Mills has Kellogg, the Yankees have the Red Sox, and Intel has AMD. Once you accept that every business has competition, what’s so bad about being over 7 times as large as your competitor? For crying out loud, Intel’s cash net of debt equals about 60% of AMD’s market cap!

We must admit that we are surprised to find ourselves writing about one of the most visible stocks in the market. Are we missing something? Can it be that such a value is hiding in plain sight? Is it just that traders and growth investors have given up on the company? We can’t fully explain why Intel is so beat up.

After today’s upgrade from JMP Securities, shares of INTC have climbed about 1% at this writing. Somebody please downgrade the stock! We’re not done buying.

I originally wrote about Intel on January 31st, 2006, in this post. I own 1000 shares of INTC purchased at $21.35. Microsoft has announced additional delays for its Windows Vista operating system. The consumer version of Vista is now slated for release in early 2007 pushed back from late 2006. I believe the delay in Vista will soften demand for both AMD and Intel processors. The delay in Vista may also contribute to keeping the price of INTC depressed longer than I originally anticipated. I haven’t changed my price targets for the stock, but I may hold off on purchasing additional shares until the company announces 1st Quarter 2006 results. I believe INTC may drop below $19 before rebounding. You can view my price targets for INTC by clicking the predictions link at the top of the page.

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