Intel (INTC)

The semi-conductors have been hot, hot, hot. His model price is $72.27 – 40% upside. They will report earnings soon. He thinks they will transition into a mobile space easily. Yield 2.3%. (Analysts’ price target is $54.97 )

It's one of the biggest suppliers of computer chips, so they can continune to capture a growth opportunity. There are chips in everything in society now. Valuation is attractive, but earnings are stronger at, say, Google. He's watching it.

If looking for a well-established dividend paying stock is this a good choice? Like the chip makers but some other names might be cheaper. You can’t argue with the chart with Intel. He likes Applied Materials (AMAT-O) because it is in the semiconductor equipment manufacturer space and it is cheaply valued. They make equipment to make chips, so you avoid deciding who is going to be the winner among the chip makers.

He has been recommending this “old-tech” company for years and thinks there is still great potential. He has a model price of $75. Yield 2.32%. (Analysts’ price target is $52.89 )

He loves the semi-conductor space. They came in with great earnings last quarter. Yield 2.5%. (Analysts’ price target is $52.29 )

One of the world's great businesses that has been at the top of its game forever. Historically, this has always been a very cyclical business. Their earnings, over time, have been quite cyclical up until the last few years. Chip prices themselves are very cyclical. For a stock like this, you either get in early or wait for the next cycle, so you need to wait for the next cycle.

The moonshot ideas on autonomous vehicles are going to take a much longer time to play out than people expect. To position yourself in this company, which has its own set of issues, he would prefer to be in Softbank (9984-JP), which gives you diversification. Nvidia (NVDA-Q) gives you an extremely high growth name, and doing a lot more than just autonomous cars, and that's the direction he would suggest.

They missed the mobile chip market. They expect revenue growth to be 2-4% a year. You can expect 8-9% total return.

Not a fan. Haven’t been able to make it clear exactly what they are trying to do. Some years their targets are gross margins, and other years it’s ROI. Thinks they are betwixt and between. Regardless of what guidance they give on capital expenditures, they are going to spend more.

He watches semiconductor stocks as a bellwether for the market. This consolidated between $38 and $33 from September until September. Then it broke out and went to $40, traded sideways for 8-9 days, and is breaking out again today. He is a big bull on the semiconductor cycle for the Internet of things. This is a really attractive company, and is talking about splitting itself sometime.

An old tech company, and hopefully they can get things together. This has huge value. It closed at $39.76, and his model price is $61.56, a 54% upside, just on their current earnings. Dividend yield of 2.7%. (Analysts’ price target is $41.)

A company in transition. They did very, very well on the back of the desktop. As desktops became more pervasive, the stock ran up, but the world moved to a more mobile environment, and their ability to take a portion of that revenue has slowed. Great balance sheet and great story, but it is going to go through a transition into an environment where its chips aren’t as expensive. The longer-term story is of much smaller growth. He is a net seller of the semi space at this point. He would suggest Analog Devices (ADI-Q), on a market pullback.

Pays a pretty attractive yield. Has a lot of cash. Transitioning from their PC related end markets to higher growth markets. Semiconductors generally have done quite well. With improving economies, it is probably a relatively safe holding. Dividend yield of about 2.7%.

It has strong seasonality from now until the first week in January. It has already established an upward trend. There is a very good chance it will break out.

They made an interesting announcement that they have a new chip coming out that will be not only faster than existing chips, but a quantum faster. He thought chips reached their limit. INTC-Q will no longer be viewed as a commodity manufacturer. They have surpassed their competitors. He expects them to gain increased market share. It has a cheap PE.