The Ignorant Investor
Ignorance Can't Stand in the Way of My OpinionTuesday, January 31, 2006
Intel at 15x Earnings: Never Thought I'd See That
I own shares of this company, so what happens to it is of deep emotional significance to me and maybe I'm biased on the company's prospects. But to see it trading at a price to earnings ratio of 15x earnings, well below the S&P 500's current multiple, is, well, shocking.
Maybe a chip maker is just another kind of cylical now, and maybe tech stocks don't deserve higher multiples. But who'd have thought a year ago that the market would get this down on one of the stars of tech America?
The market sentiment seems to have shifted to AMD, but I suspect that's more a matter of fashion than substance. I'm thinking that Intel is getting one of those whippings that the market periodically decides to dish out when earnings aren't growing as fast as Wall Street wants. I'm betting it doesn't last over the long run.
Maybe a chip maker is just another kind of cylical now, and maybe tech stocks don't deserve higher multiples. But who'd have thought a year ago that the market would get this down on one of the stars of tech America?
The market sentiment seems to have shifted to AMD, but I suspect that's more a matter of fashion than substance. I'm thinking that Intel is getting one of those whippings that the market periodically decides to dish out when earnings aren't growing as fast as Wall Street wants. I'm betting it doesn't last over the long run.
posted by Worker 17 # 1:36 PM 
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