Is Intel Priced to Fail? Two Articles on Intel


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Jae Jun

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As I didn’t get much response about large caps, it’d be better to post links up in a single post as opposed to filling your inbox.

The company in focus is Intel.

Couple of valuation articles for you to read.

Intel Is A Solid Pick Worth Over $35

Quick Summary

Intel (INTC) has solid fundamentals and passes all quality checks with flying colors. Valuation ratios are at all-time lows and fair value calculations shows the company to be valued in the $34 – $37 range.

With its dividend yield just under 4%, Intel looks to be a great buy for dividend investors.

Why The Market Is Wrong Believing Intel Will Grow at Less Than 3.8%

Quick Summary

Using reverse valuation methods, the market expects Intel to grow between -2.3 to 3.8%.

What’s With All These Large Cap Valuations?

There is only so much I can write in an article when analyzing a company. Obviously you don’t want to read 5 pages of analysis. I believe that’s overkill for any blog.

So with these large cap valuations, it provides a good look at the things I look for when analyzing numbers. Large caps are also good to get feedback. More people know about it so you hear a wide variety of comments and there are always good points that I may have not thought about or missed.

So in an effort to make sure I don’t get lazy and continue to keep trying to value companies (practice makes perfect) I’ve been writing about large caps in between the education focused articles I write on Old School Value.

Small caps and interesting names will also continue to show up on the blog.

  • hromay

    I agree with you that INTC is cheap. Also consider they are developing new things that will impact positively in the future, low voltage chips for cellular phones, ultrabook laptops, etc.

  • dgoyal

    Jae
    This is related to OSV analysis on Intel recently posted by you. I have one question on market cap values used by you for Altman-Z on page 11 of that PDF.
    2011 market cap shown by you is 133381. My calculations show market cap on Dec 31, 2011 as 121250 (5000 million share outstanding x closing $24.25 price per share on Dec 31 2011)

    Similarly, my market cap numbers for 2007,2008,2009 and 2010 are 152572 81539, 112669 and 115896 respectively.
    Am I calculating market cap incorrectly?

  • I believe the difference is coming from the shares outstanding. To get the true market cap, you should use diluted shares outstanding instead the basic shares because you have to consider the options and convertible debt.

  • dgoyal

    Not exactly. I also used diluted weighted shares for my calculations – Market cap (diluted weighted shared * price on Dec 31) for 2008 till 2011 are
    156473,
    84266,
    115158,
    119787,
    131217. All of these numbers are higher then those in your analysis. As X4 is largest number in Z calculation, it is influencing Z score. Can you please share numbers used by you for market cap calculation?

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