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Intel Corporation Message Board

  • bacbacker bacbacker Jul 10, 2013 12:14 AM Flag

    INTC is extremely cheap right now

    The last 3 quarters (including the just ended Q2), Intel was hit by one time excess capacity charges and startup cost for the 14nm FAB upgrade. This caused GM for last 3 quarters to drop below 60% and resulted in the lower-than-usual earnings. Starting this quarter, GM will be back to normal (above 60%) and Intel is expected to earn $0.65 (Q3) and $0.74 (Q4) (See article by Russ Fischer). This means we should see plenty of ANALyst upgrades coming after earnings release next Wednesday (current estimate for Q3 is $0.50).

    Compare Intel to Cisco, which has EPS of $1.75 to Intel's $2.00. Which out of these two companies will more likely double in revenue in the next couple of years? Intel is taking major market share in the tablet market this year with Bay Trail, and smartphone market next year with Merrifield. Intel is also going into other markets such as SSD, wearable devices, foundry, Intel TV set-top box, etc. On top of this, expect Intel's server market to grow in double digits and tradition computer markets start growing again with Haswell/Broadwell introduction. Cisco stock price currently at $25.16 while INTC is at $23.13. I think Intel is extremely undervalued here.

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