Interesting Notes On Intel
I got this note about Intel from Lehman on Thursday morning:
“The bottom line: the company (i.e., Intel) says it is capacity constrained in note books in the current Q and that the server business,
while competitive, remains strong. Emerging markets remain an area of strength and Tim continues to see margin upside. (Lehman)
raised (its) numbers and target yesterday and expects the stock to work higher into the (June 9) mid-Q update.”
Interesting…
I infer Intel can ramp its money losing NOR (flash) business to keep the fab full and, in so doing, show a better processor gross margin?
Also, by “Emerging markets” for PCs figures to mean China and India, but the margins there do not look exciting…
Maybe a salvation for Intel is if the western markets shift to notebooks in sufficient numbers to alter the desktop/notebook unit sales ratio.
If this happens, then perhaps this could generate enough incremental profit to offset lower-margin processor sales in Asia?
Hmmm…
Most of
the data points I’ve picked up have been positive in PC’s this quarter. But
this is well known already on the Street, in my view.
That being said, INTC is relative attractive versus other areas of tech, and
if margins tick upward post the second quarter, then I would be careful on the
short side.
The Apple / Intel discussions are unlikely to be a catalyst for AAPL, INTC, or AMD. AAPL looks like it is in a topping formation. I am technically neutral on the name with a very, very slight bullish bias. I would not be short. INTC looks to be reaching a buying climax (based on average increasing volume). If we see high volume dip to with 1 point decline on a red candle, then I’d probably wait for a light volume lift and a lower high to confirm the short trade back to $24 to $25.
Â
Melanie Hollands
melaniehollands@yahoo.com
