Intel makes new 52-week highs; BMO positive on supply chain data

PC motherboard shipments were better than expected in May, writes BMO's Keith Bachman. whose firm upgraded Intel (INTC +1.5%) to Outperform in January out of confidence in Brian Krzanich's strategy changes.

Bachman also sees motherboard shipments rising 6% in June - slightly better than the 5% averaged over the last 3 years.

PC shipment declines have been gradually slowing. IDC estimates shipments fell 4.4% Y/Y in Q1, better than Q4's 5.6% drop and Q3's 7.6%. But it still sees a 6% 2014 shipment decline, thanks to a 10.4% emerging markets drop; higher-ASP "mature markets" are expected to be flat.

Shares are making new 52-week highs. They currently go for 15x 2014E EPS, and 14x 2014E EPS.

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Comments (7)
  • papayamon
    , contributor
    Comments (1391) | Send Message
    Intel as been stagnant for many years... very similar to MSFT before it broke out. I think we are finally there with INTC. I see INTC with at least a 25% upside in the next year - even if management doesn't deliver a new, game changing technology -which it might.
    6 Jun 2014, 12:59 PM Reply Like
  • whiteowl
    , contributor
    Comments (604) | Send Message
    This is the safest risk/reward candidate in the sector. Expectations are low, interest is coming back into the stock, and a fat dividend supported by strong cash flow limits downside. If any of the positives were to occur, such as a renewed PC cycle or actual traction in mobile or a new-tech development, the upside from these levels could be quite substantial.
    6 Jun 2014, 08:42 PM Reply Like
  • Duane Byron Carlson
    , contributor
    Comments (171) | Send Message
    Thanks for the opinions. I shall consider it once again.
    7 Jun 2014, 01:52 AM Reply Like
  • techy46
    , contributor
    Comments (12073) | Send Message
    The INTC Jan 15 and 16 $20 LEAPS have done really well for me up 58% and 43% respectively and more recently the Jan 16 $22 up 39%. Time to take some off the table or wait for a correction to double down?
    7 Jun 2014, 10:53 AM Reply Like
  • Stock Market Mike
    , contributor
    Comments (3744) | Send Message
    With options it's never a bad idea taking profit... Up 60% can be "up $1" depending on your entry point. It's easy to lose that dollar, and then you're flat. Or lose two dollars, and then you're negative.


    Perhaps compromise by selling a portion and converting to shares, or sell some calls against your calls? If the stock keeps going higher, let both expire in-the-money?


    11 Jun 2014, 12:11 PM Reply Like
  • whiteowl
    , contributor
    Comments (604) | Send Message
    I'm rarely smart enough to anticipate those double-down corrections. I've learned to not get too cute with holdings I believe in, if the story hasn't changed. With INTC, I'm in for a penny and in for a pound. But that's just me.
    8 Jun 2014, 02:17 PM Reply Like
  • legal eagle
    , contributor
    Comments (36) | Send Message
    buy!buy! buy!
    8 Jun 2014, 10:18 PM Reply Like
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