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Wednesday, September 27, 2006

Calls of Note Part 2

- Jefferies has positive comments on Intel (NASDAQ:INTC) saying that on the first day of IDF, they were impressed with Intel's technology and manufacturing plans. The firm is getting increasingly convinced that the company has turned around and should begin to regain market share on back of its new products, superior roadmap and manufacturing capabilities. Finally, Intel now has in place all the ingredients that should enable the company to show demonstrable share gains in 2007 and beyond.

Company unveiled quad core processors for servers and desktops. These new processors are expected to ship in middle of November this year. Firm is encouraged by Intel's introduction of Quad- Core MPUs at least six months ahead of AMD (NYSE:AMD) and believes that this is a sign that Intel is aggressively responding to AMD's lead in multi-core architectures.

Based on their increased confidence in Intel's ability to compete driven by a competitive product lines across the board and a leaner organization structure, the firm is raising their 2007 estimates for Intel. While they are keeping revenue estimates unchanged at $38.8B, the firm is raising pro-forma EPS estimate (including ESOs) to $1.09 from $1.02. A superior product line should result in better pricing power and improved margin profile. Current 2007 street estimates for INTC are $37.7B/$1.09.

Tgt is upped to $24 from $22.

Notablecalls: Not actionable but good to know category. I still think INTC is a sell here. It will take more than new processors to fix this one.

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