Intel (INTC)

Recently sold his holdings. They came out with some pretty disappointing guidance. Thinks they will turn the corner here. They are investing a huge amount of money in research and development. They are investing more money every year than what their major competitor ARM Holding (ARMH-Q) is worth. PC shipment business has been tough. Having some difficulty in the new lines of business. They have been expanding into. Likes the 3.7% dividend which he feels is secure. Good balance sheet. Feels their movement into chips for the cell phone business will be successful but is a lower margin business.

(Market Call Minute.) It might have some promise. Spending a lot of money. They’re a big company and have a big CapX program but are not really growing their revenues.

His model price for today is $36, a 51% upside. A year from now it is almost $40. Lots of upside. Yield of 3.77%. The trouble with all of these large-cap techs is that they have a lot of value, but are just sitting there.

Not positioned for mobile because their chips use too much energy. They are moving to better chips to compete with ARM. There is this big battle going on and it will pressure prices for a while. Their margins will come under pressure. They can probably continue with their dividend but growth will come under pressure.

Have some headwinds in that they were the PC chip set leader and that market is shrinking in favour of other technologies. They have the size and scale that they can reinvent themselves, so don’t dismiss them, but do wait until they reinvent themselves. Pass for now.

Good dividend yield. Spends $14 billion a year in research, development. Growing out new product lines. Missed the mobile phone market but is there now. Feels that investors are far too pessimistic about this company.

Not a fan. This is a tech company that is in denial of their growth prospects. They are the gorilla of market share but have nowhere to go because there is no real growth in core PCs.

Street was negative on this because they largely don’t have leverage to the mobile market. They missed this completely. Hands-down they are the best chip maker out there. Lost direction when they missed the mobile market. Thinks the stock will continue to work because they will gain market share over time. If they can take 1% of market share per year over the next several years, it is a positive trajectory for them. It is now starting to gain leverage to the mobile market and he likes that the chips are the best chips available. His bias is positive on the stock.

Growth has been very sluggish and is being replaced by tablets, etc. Have a new chip coming out and that may be a catalyst. They have 80%+ share and it’s difficult for them to grow in an environment where the economy has been slow and the market for PCs and laptops has been really negative.

It is controversial but he would buy it today. Thinks they will regain market share. They ARE the PC business. There is not a lot of market share to lose in that area. At some point PC sales will stabilize. They have a rich dividend. Don’t count them out yet. There are better places to be, but he would hold it.

His 3 picks today are all technology related. He is seeing earnings and revenue growth over time and a global move towards more mobile telephony technology. This company is trading at around 12X earnings with a 3.96 % yield. Spends $14 billion a year in research and development. Expecting they will come out with an innovative solution in new chips.

He is pretty positive on the entire technology space, specifically in the US. This one has great dividends so you are paid to wait. Had a bit of a rough go over the last little while because of competition. They were a little bit late moving into the mobile space. They plow a ton of money back into R&D and they are the dominant player. Good price.

They have wind in their face because their business was the PC business and they got left behind in the evolution to tablets. With their size and resources, they have an opportunity to catch up. They are doing some impressive things right now. There are a lot of unknowns but there is an opportunity that is not fully priced in. Would buy when there is better certainty.

Model prices $35.52, a 56.5% upside. Yield of about 4%.

Advanced Micro (AMD-N) versus Intel (INTC-Q)? Intel is obviously the gorilla in this space with their 10%-15% marginal share. If she had to choose between the 2, she would pick Intel because they have much more 80+ share. They will participate more if we see the PC market start to improve. Would wait as there is not a rush to buy anything, especially with the general volatility in the market. With rising rates, the whole market could pull back.