I share your concerns. Fact is, MSFT has killed PC's with the failed Win 8. And we've seen significantly reduced motherboard orders by Intel. I think the MSFT kick-in-the-shins to PC's spells disaster. I am worried about INTC pps over the next half year.
"Current estimates for 1st and 2nd quarters are 0.42 and 0.41 respectively. That's a major drop from last year. Why are they so low? I don't think stock can rebound if earnings are this low. Thoughts?"
[You have to be kidding. The stock price has been beaten down by 9 bucks from last year. You don't think that's enough to position it for a significant move up? Look at the P/E ratio for goodness sakes. If they have any earnings the stock price should move up smartly from where it is now...]
The main reason is that Intel's investments are mostly front ended this year where they are planning huge investments for future gains in all types of computing device from smartphones all the way up to servers.
Intel is very confident in its capabilities of gaining some serious market share given their technological advancements. So the lower bottom line numbers are mostly due to investing in capex for the future. Analysts complaining are being hypocrytes here. Because if Amazon doe it, they say it's okay.
And before anyone brings up Amazons revenue growth, that part of the story is due to Amazon pretty much doing what Warren Buffet doesn't like. Which is "Selling a dollar for 50 cents".
Intel is basically investing in a huge success in mobility and very much necessary growth in servers which they are very confident of. Investors would be much wiser to pay attention to Intel's current actions and words rather than what any analysts have to say.
I was pleasantly surprised by how fast Intel intends to move on 450mm wafer implementation. This will bring another huge process lead in addition to its economic benefits. Intel is building and installing the technology that will allow them to be more profitable at each smaller process node while ARM has failed to make these same investments (well, they couldn't because of the broken fabless, capital-less model). How Wall Street can miss so many huge strategic moves is a total mystery...