I'm seeing that as well but it could be one black swan event like problems in the middle east that could throw a wrench into things. I'm thinking that despite the bashers best efforts Intel's "dead money" story has gotten old. This alone may push the P/E up a few points. But i do see mild growth. A simple P/E growth of 2 points would bring the price up to the high 28's. 6% growth and a P/E of 15 would take the stock over $30. Thus a 30% growth the stock isn't unreasonable. I've also been noticing the lows Intel hit this past week was in the mid 23's. It used to be in the mid 21's. My guess is that Intel will spend the better part of next year running from 25 to 28. But a couple of better than expected quarters and a few more big design wins and it will be past 30.
"To bring your crystal ball into focus, INtel will be forced to open its fabs.
Result will be beyond positive and returns will trump x86 revenues."
The newest ARM talking point. Intel will wake up one day and say "Wow, we've been missing the boat with ARM, look at all these great revenues, who needs x86?" It will be ARM revenues to fund Intel "Bribes" as you like to call them. ARM is financing Intel's entrance into mobile and it's gain in market share in x86.
I am looking at the year 2014 in my crystal ball and I can't make heads or tails out of what's to come. We do have that long awaited XP upgrade but on the other hand there could be more economic woes and a possible Wall Street correction. If you predict gloom and doom Intel can go down to $16 a share, but the rest of the market would be in the toilet as well.
The rate of PC sales declines are slowing down and 2014 may be a turn around. If you believe consumers have replaced the PC with the tablet and smartphone then that would be a factor. If you think that there is a lot of pent up consumer demand and consumers will be buying more PCs then that would drive growth.
I'm a bit more positive about 2014 than Intel may be a the current time. But, lets run on their assumption that sales remain flat for 2014. In order for the stock to increase the multiplier needs to go up. This is caused by people believing that future returns will be greater than they are now. Keeping in mind that the working assumption is a flat 2014 do you think the P/E ratio will increase in 2014 driving the stock price up even without a dividend increase?
You clearly understand technology but the rebate programs have you a bit confused. A bribe would be be paying an engineer under the table for a design win. If you ever find Intel doing this I will be as outraged as you will be.
A rebate program works as follows. If you buy $1 million from Intel in 2014 we'll thank you. If you buy $1.2 million from Intel in 2015 you'll get 3% back. If you buy $1.5 million (or more) from Intel you'll get 5% back.
I suspect that Intel wants to get the ball rolling on its sales so it will discount the processors up front. It's like an introductory sale price. They do this to get design wins. If ARM was coming into an Intel dominated market they would do the same thing. The combination of great performance and an attractive low price is a bit much for most companies to turn down. Add to that help with advertising and the deal gets sweeter.
I can see why you're upset. People misjudge Intel all the time. The phone and tablet SoC is a nice market but at lower margins than Intel normally likes to work in. But as you eluded to so many times ARM was ramping up and Intel looked at the market in a couple of ways. First, enter it and make good returns. Second, gain a lead over ARMH that prevents it from hitting Intel's core business. Many have complained that Intel won't make its traditionally high margins in mobile. I think that they can do it, or at least come close. The real end game however is to neutralize the threat of ARM long term. Yes, ARM is winning for now, enjoy it while it lasts.
This looks like good news but I don't think it is. I am convinced that Intel told analysts that 2014 was going to be flat because they were setting them up. There would be one quarter where Intel would blow past expectations and leave institutional investors holding short positions covering at huge losses. This would break the $2 range play they love so much and take the stock out of the shackles. Now it looks like they are starting to wise up. Trust me, i love the stock going up but until they get massively screwed over they will keep the stock held down.
Best example of class warfare ever! Thank you for sharing this story. You should let us all know what restaurant this is so that Republicans keep their evil money away from it. Then again is this a safe place to eat? I mean what if you walk in with a Yankees T-shirt and the kitchen staff are die hard As fans? There is a duty of care and a breech of duty of care. Sure this doesn't mean much, but you would scream like hell if a nurse put a needle in your kids arm that came out of someone else's arm. I don't know how you feel this post advanced the Democrats position. It just makes me think that class warfare is deeper than we know.
"ARMH has doubled since your predictions of doom
and INTC... your predictions have been 100% WRONG"
100%? No, I remember you as the largest RT cheerleader. This was going to open the door to the Wintel franchise as you put it and ARM/64 would be the death nail. I think the terms you used was "Intel is surrounded at all sides." and "ARM is a blueprint to print money." I predicted it's failure.
Just out of curiosity, the Windows RT Tablet is now $199. Did you ever buy one of these tablets at any price? I mean if you didn't buy one as the largest fan of the ARM Microsoft venture, then what's the possibility that the average consumer would buy one? And if you didn't buy one then it would confirm my suspecions that even you knew RT was a failure.
"I think the upgrade was part of a pump to help the smart $ out & bring in the dumb $" Man, I hope you're right. ARMH is at $50 a share, plenty of dumb money out there!
Topic gets deleted on here, so go to MF and find this title - A Windows RT Failure Will Sting These Chipmakers. The three in question are QCOM NVidia and of course ARMH.
Nvidia perhaps, it's the smallest company and the one with the most to gain. QCOM not so much and ARMH is at $50 a share. The article points out that Nvidia has lost $300 million on the deal and Microsoft $900 million.
This was really about Microsoft trying to claim market share in a market they invented but never went anywhere. At the time of the first tablets they were huge, heavy, slow and had short battery life. Looking at the success Apple had with the phone and tablet market I can see how they came to the conclusion that small, powerful but energy efficient RISC processors were the solution. In reality they performed well for Microsoft. It was Microsoft that could't get the right Mojo for the consumer market.
But Microsoft has been here before, making Windows NT to run on RISC servers back in the mid 1990's. At the time RISC servers had much better performance than Intel. And the lead translated into nothing substantial for Microsoft.
What Windows RT represented was a window of opportunity. I feel that QCOM and NVidia put their best foot forward, and Microsoft did as well losing nearly $1 Billion on the endeavor. ARMH I don't feel the slightest bit sorry for, they spun press releases and held victory parties but in the end proved themselves as nothing more than another RISC processor designer. There once in every two decade opportunity was wasted.
The difference between Intel and ARMH isn't as much about the technology advantages Intel has in manufacturing, it's more about how they act upon opportunities. Intel is currently out promoting the new Windows 8.1 tablets and helping sponsor ads with it's own money. All the design wins for Intel at ARM's expense are bad news because they will most likely never come back to ARM. Intel knows how to keep business.
once they show up roughly a year from now, it might be really tough for Intel to get some high-volume design wins in the phone space, despite the transition to 14nm
"A large well funded company that is on a multibillion dollar quest for total market dominance that shows up tot he market with superior products may have a problem getting design wins."
Watch and learn, designers can't beat a path to Intel fast enough.
Someone else wrote an article in MF about the declining iPad sales. They now have a global market share under 30%. Looks like that A7 did wonders for them. I thought that corporate America was going to replace their aging XP computers with them? Here's what Apple needs to learn right now. For under $150 you can buy a toy, for over $400 you can buy a computer. Deal with it.
I used to pray for the day this would happen. Now, not so much. The A7, the pride and joy of the ARM community is being purchased for $18 each! These are going into tablets that are selling for over $500. They are not selling out like they once did. It seems that the A7's superior performance hasn't turned into consumer demand. I think Apple is going to turn this logic around around and say that hardware doesn't sell tablets, shiny Apple symbols do. I doubt Apple will be willing to pay a fair margin for Intel processors as they squeeze vendors to lower the BOM.
One factor that may affect this number may be roughly attributed to a shift in policy at TSMC. Up until the change you could set a contracted price per CPU. But TSMC had yield problems they said they had at 40nm and claimed they resolved and then a year later they said the same thing. When it came to 28nm they stated they were shifted to a pay per wafer model. If the wafer produce 1000 CPU's it was one price, but if it only produced 7 it was the exact same price. Some called it the "pay for many, get few" model.
One of the first 28nm parts to come off the TSMC fab was for a $600 NVidia video card. It took them about half a year to be able to make enough GPU's for these cards to satisfy demand. But I was thinking "how much demand is there for a $600 video card? 20K units perhaps? " I think Nvidia didn't care if it was paying $25 a GPU or $60, there was fat markup and backorders.
Flash forward a year and a half later at 28nm isn't the de facto node of TSMC. I think this 'pay per wafer' decision may have cost them a shot with Apple. The backup caused by this I also think can be traced to the ARM Android tablet market of today. The sub-$150 7" tablet market isn't night and day worse than the over $200. For more money you get a nicer screen, more RAM and a slightly faster processor.
If you look at many of the sub $160 7" tablets they have MediaTek SoC's which I believe are fabbed at UMC. By not pushing 28nm faster, harder, and out of their pockets TSMC left the door open for competition. I think there will be significantly more tablets sold this quarter with TSMC losing market share. to Samsung and UMC and of course the new player, Intel.
Step #5. When Intel has more business than it knows what to do they can kiss ARM goodbye.
By this time Intel will have a large enough lead that it doesn't have to worry about ARM anymore. It will be thrown under the bus.
BTW, bribes are something you usually don't disclose such as giving out $1 million in offshore funds to the first 1000 design wins for Intel Atom. These rebate programs are perfectly legal and effective. The reason why people get mad about the rebate programs is that they work a bit too well. Unlike the $1 billion Microsoft lost on the RT surface.
I'm long INTC for it will play out exactly the opposite of your claim..
BTW, I wrote about two years ago that Intel could be a FAB for ARM and Getanid61 called it "desperate" at the time. I admit that was a bit of a longshot.
The thinking of Daniel Nenni and other ARM fans is that Intel fabbing ARM is an admission of defeat. ARM can now boast about having the best fabs in the world supporting their model. The logic goes that once Intel makes fat ARM profits they will never stop fabbing for ARM. The ARM ecosystem will be supported by Intel on the high end on down. The ARM franchise will become even more valuable.
My belief is that Intel isn't interested in foundry fabbing profits as much as they are interested in market domination. ARM64 at a similar node to Intel could inflict some real damage to Intel in the long term.
Step #1- Defund ARM Foundries. The best way to do this is to take business at the high end that cuts demand at TSMC. This will #$%$ node development by cutting funding.
Step #2- Use fat ARM foundry profits to pay for bribes. The best part of the $1 billion "bribe" is that ARM is helping to fund it. Imagine if they did this for year after year until each year ARM has less and less business. The ARM profits also help pay for the Intel Capex.
Step #3-Find out where the bones are buried- Its easier to score Intel design wins when Intel is a foundry for ARM. They will have a working the designers and they can talk about the benefits of Atom. At first it will be the low priced alternative to ARM and yes at first it will be a harder sale.
Step #4- Give the goodies to Atom, not ARM. Right now Intel has a compelling CPU to ARM64, but not a hands down winner. They also can't fill in the rest of the SoC by themselves. Too many essential parts are missing. When Intel makes a better GPU, and has better wifi and bluetooth connection along with better LTE it will get people excited. That will go into Atom not ARM processor
Hey for an extra $100 or more you can have an iPad Air with an A7. You know the benefit of having an A7? For no additional charge Daniel Nenni will call you up and tell you how wonderful it is.
This holiday season we've got an abundance of 7" tablets for $150 or less, some below $100 if you're not afraid of no name brands or refurbs. Dell, Asus and other worthy tier 2 brands in the tablet market are making a name for themselves.
The problem is that from last year to this year with the exception of Apple and Samsung ARM hasn't moved that far along the spectrum. From what I can tell the new selling points are a bit faster processor and better screens running at higher resolutions, more ram and a tad bit lighter. The problem is that for what the 2013 version of the Nexus 7 costs (close to $300) you can have two and a half 2012 versions (refurbished).
Go look for yourself, there are compelling ARM Android tablets for under $150 that aren't state of the art but will more than take care of your tablet needs. Even Intel has a dog in the fight with the Dell Venue 7. This sub $150 market will grow the tablet market and make Apple's prices for the iPad Mini seem excessive at $300+. The tablet market will grow with Apple getting less and less market share. And when all those old $500 iPads and iPad2s expire what will people replace them with? Apple? Don't be so certain.
The tablet market isn't a computer market. People are interested in 'bang for the buck' as people think of tablets as simply consumer electronic devices. 1 Billion dollars and an aggressive advertising program to differentiate Intel's PC tablet offerings will stir up the market. It will go a long way to help Intel stand out in a consumer electronics market clogging with commodity ARM technology.
The new A7 processor is lost on the masses. the iPad2 was out of stock for months at a time. Now it's readily available on Amazon with 4 out of 5 star rating. There are only 40 reviews. Oh no Apple fans, looks like something is wrong!