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In 2013, Intel was up more than 25% excluding dividends. That may not be the best investment in semi but it was at par with market.
All this happened during the period when there was a management change and not phones/tablets revenue. Go figure that out.
If you know how to invest properly, you could add additional income by writing puts and calls.
Days of buying and putting shares in your lockers were gone long time back.
Great explanation. Wonderful.
Again, it is not the cost of chip. This is the new form of computing and Intel does not to miss. This was clearly stressed in last IDF.
You are already upset that Intel missed the boat in mobile which Intel admitted. It is addressing that with products and pace which does not make any one of us happy. But that is reality. If any one of us don't like that, we have a choice to invest in others companies.
Smartphone market except for a few high end phones(Apple) is becoming a commodity and there is no money to be made. Intel clearly stated in IDF in Nov. that it will not miss the future computing trend. It will at the same time try to address the mobile market.
Its share has grown in tablets and will grow further.
Intel is addressing it as it sees fit and not at your pace. That is why it is up to you now what you want to do with your money.
You and Asharaf are stuck on one thing. I am posting the same broadcast from Intel CEO and see the difference. He covered every new technology you can think of. and both of you are stuck on mobile phones. look at the last line. I have marked it bold so that you can see it clearly.
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Jan 6, 2014
9:42 PM
CES: Intel’s Krzanich Says Its Chips to Be Free of ‘Conflict Minerals’
By Tiernan Ray
Intel (INTC) CEO Brian Krzanich this evening was the opening keynote speaker for the Consumer Electronics Show at the Palazzo ballroom of the Venetian Hotel in Las Vegas. Krzanich, who replaced Paul Otellini at Intel last spring, took over the role occupied by past openers such as Microsoft's (MSFT) Steve Ballmer and Qualcomm's (QCOM) Paul Jacobs.
Krzanich's talk followed a talk earlier in the day by Intel exec Mooly Eden about the things Intel is doing in “perceptual computing,” and a little teasing of a partnership with 3-D printing company 3D Systems (DDD).
Lights go down, pounding music comes on. Gary Shapiro, head of the Association, comes on stage to introduce Krzanich. Shapiro gave a brief history of Intel's history, going back to Robert Noyce and Gordon Moore, though he did stumble over Krzanich's name a bit.
Krzanich segways immediately into a high-octane video across all three screens to let people know what he means by his claim that a “new world” is being built. Lots of snazzy graphics that look a bit like a Nova special on the birth of the galaxy.
The idea of computing as something you carry or that sits on your desk is about to change, he says. He wants the audience to be “immersed” in “experiences,” for which, he says, he is prepared to “take some risks.”
He wants to talk about how working, living and playing are changing. To start, he delves into wearable computing. It has suffered as a product category because it hasn't solved real problems.
The answer, he says, is simple: “make everything smart.” The answer, smart ear buds! A young woman comes on stage to show of the ear buds. Indira, she is one of the developers of the technology at Intel. Built into the ear buds are sensors that do things such as measure heart rate. The point is that there is no charging of the device — it's charged by the smartphone that it's plugged into.
A second device is a wireless Bluetooth headset that is constantly listening for natural language instructions. Think Google Now. Larry, the Intel expect demonstrating, seems to parse the instructions and offers very intelligent-sounding responses in a high-class female British accent. The device is nicknamed “Jarvis.”
These wearables raise the problem of how to charge all these gizmos. Intel has developed a prototype wireless charging “bowl.” It is rather like a slate gray salad bowl. You toss the device into the bowl and it just starts charging.
What about a watch? asks Krzanich. “We've got it,” he says, and produces a black wristwatch with a color display. It is distinguished by having its own connectivity, so that no tethering is required.
It will take lots of partners, says Krzanich. In particular, the company is working with retailer Barney's and fashion design firm Opening Ceremony to make a family of “wrist-worn” smart devices.
Next, Krzanich shows off a computer composed of the company's Quark processor family that fits inside of an SD memory card. Called “Edison,” Intel is going to make the device available to developers in the middle of this year.
What can you do with Edison? Krzanich shows off a child's play toy with Edison built into it. A “smart turtle.” Like a stealth baby monitor.
It measures breathing rates of the child in their crib, and it sends the data about the child's stats to a coffee mug that the parent is drinking from. The mug lights up in a rhythmic pattern to indicate the status of the baby.
To help spur development of Edison devices, especially wearables, Krzanich announces a contest that will award a total of $1.3 million to multiple winners. The competition, “make it wearable,” will also connect the top ten winners to domain-area experts to help them.
Regarding security, Krzanich says the company will start giving away its McAfee security software for use on all manner of mobile devices.
Krzanich moves on to tablets. Restaurant chain Applebee's replaced table service with Intel-based tablets. Krzanich said it improved performance of the restaurant, and raised the average tips paid to the waiters by 15%.
And, as speculated last week, Krzanich said the company will offer support for “dual-OS” systems that run both Google's Android and Microsoft's Windows.
Finally, some clarity on the 3-D printing angle. Intel will provide 3-D scanning technology that will be built into laptops “by the end pd this year.” You'll be able to use a tablet, for example, to scan an object, and send it to a 3-D printer.
Krzanich brings on stage the first star guest of the meeting, Jeff Katzenberg of Dreamworks. Katzenberg extolls the great stuff Krzanich and Intel are doing, and how important tech is to film-making, though it's all a bit vague.
Turning to play, Krzanich invites the audience to experience immersion within a story. On the video monitors, a giant whale from the kids' tale “Laviathan” is shown floating above the audience members — the audience has been captured using cameras and the audience has been inserted into the video with the whale.
Next, Krzanich brings up celebrity guest two, hit PC game company Valve's Gabe Newell. He tells Krzanich that Valve's game network, “Steam,” now has 65 million users.
Today, Valve announced a series of gaming appliances running on Intel — small devices that serve as consoles for Steam games. Newell says he's very excited to use Intel technology to “bring PC gaming into the living room.”
Next, Krzanich says he wants to take a departure, to talk about something that is very important to him personally, but not something often talked about at CES: death in sub-Saharan Africa as a result of the mining of “conflict minerals.” The monitors display a series of images — finger on a trigger, a young man apparently lying dead on the ground — and words such as “murdered.”
“The minerals are important, but not as important as the lives of the people who work to get them,” says Krzanich. He says that after four years of work by Intel on the problem, every Intel processor this year will be “conflict-free.” Big applause from the room for that. He invites the industry to try to follow suit.
To end the keynote, Krzanich brings up on stage several innovators, some employees, some Intel prize winners, mostly very young — the youngest, just a boy 14-years old — and calls them innovators in the tradition of Noyce and Moore.
A classy finish to a fairly classy keynote. Maybe one of the better keynotes, in fact, in recent CES history.
Thanks for your explanation. I wish you the best.
Yes, I have a right to read what I like but don't you think you are destroying your own credibility. That is your decision and not mine.
There are quite a lot of us here who have invested in Intel more than a few years you have invested in.
There is a way to make money in Intel's investment. If you have lost faith in Intel, yes, you should look for another investment. You are already short ARMH. You better cover those fast.
I wish you all the best.
I have heard of Denver project for the last 3-4 years. sooner or later, details will come out. What is the big deal?
Your emotions are all over. One day you are so optimistic and next day you are so down. How do you expect any one to believe you about your various write up. Very sad indeed.
I never denied that for actual and professional work one needs what you have described- a real power house machine. These will be needed and have a place in computing.
My original post was in comments to sales of Chromebook and how it has affected sales of notebooks of all kind including from Apple.
In my opinion, that trend will continue in short term.
Eventually the tide will turn and every one would like to have a real laptop. Even tablets have reached a saturation point. Now real products will survive and all others will disappear along the way.
I did not mean that it will go away. It will go back to those days when Apple share was very low.
But it will have to respond to Chromebook phenomena. It can't avoid it.
I just wrote Jan. 26 calls and Jan. 26 puts and collected $1.10 from both calls and puts. either one of them will get executed. That is close to 4% for the next 18 days.
If sales continue to decline, it has no choice except to match Chromebook style. No HDD, no optical drive and anything else it needs to bring the price point lower. Yes, it does not have to any development of products, but match Chromebook.
There is another reason. Apple is consumer oriented company and it focuses more on iphones and ipad. Sooner or later, laptop category from Apple may disappear and Intel will loose those sockets outright or apple will move to its own chips. Macbooks will become more like Chromebook hooked to cloud.
Exactly. One has to pay one way or the other. Nothing is free.
After that article, it should have 100% market share. For Enterprise, you want the best reliability.
That speaks volume for Intel SSD product lines. Why is Intel not using this in its marketing its SSD products?
I do care but you were not sure about this. I will have to wait till there is official announcement. In the mean time Intel has offering in tablets like HP going for $99.00 Intel management has kept its promise.
The whole market is going up. Even other stocks like CSCO has gone up. Intel's move is much smaller than overall market or QQQ.
Here is another article on Caldxeda bowing out
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Applied Micro, Cavium to Benefit as Calxeda Bows out of Intel Challenge
By Tiernan Ray
Calxeda, a privately held chip maker that has been for a couple of years now one of several hopefuls in the battle to supplant Intel (INTC) in the server market, is apparently going out of business, according to a piece from AllThingsD‘s Arik Hesseldahl, who last night wrote that one source tells him “they just ran out of money” after having bagged $90 million in venture funding.
That news has left the Street today to contemplate the fate of other companies trying to use the ARM Holdings (ARMH) chip designs to build microprocessors that will power an emerging class of “micro-servers.”
Shares of chip maker Applied Micro Circuits (AMCC), which is one of the hopefuls in that battle, are down 20 cents, or 1.6%, at $12.40, and Cavium (CAVM), another one, is down 62 cents, or 1.7%, at $35.37. In addition to those two, many other ARM-based chip designers are considered in the running, including Nvidia (NVDA) and Qualcomm (QCOM).
Shares of Advanced Micro Devices (AMD), already a major player in servers, and long an Intel rival, are up 4 cents, or almost 1%, at $3.69. Intel shares are up 13 cents, or half a percent, at $25.27.
FBR & CO.’s Christopher Rolland today pounds the table for shares of Applied Micro, reiterating an Outperform rating and a $16 price target, arguing the company’s own 64-bit ARM-based sever chip, “X-Gene,” is underappreciated by investors.
To Rolland’s thinking, Calxeda just had the wrong approach, and its demise is no reflection on the general ARM-based server market, which still is viable:
We believe this shuttering will have limited near term impact for the ARM server opportunity. We offer the following thoughts; firstly, Calxeda was reportedly looking for another round of funding (perhaps for well over a month now). Secondly, the company‘s current EnergyCore processors were 32-bit with two generations before they released a 64-bit processor (and $5 to $10 million a mask set for each generation). Finally, the company ‘s ARM based processor strategy was based on the FAWN (Fast Array of Wimpy Nodes) approach, an outdated but popular theory about five years ago for low-power microserver processors. Indeed, hyperscale applications require 1) 64-bit and 2) a minimum threshold of processing performance unlikely to be reached by Calxeda’s approach.
X-Gene, he thinks, will surprise some people with how good it is:
Since ARM TechCon over a month ago, we have held numerous follow-up conversations with software and hardware engineers who have had hands-on experience with X-Gene. Some of these engineers work for open source application developers that have ported their apps to run on X-Gene, while others were associated with server OEMs. Universally, these engineers have reached the same conclusion: when specifications are finally released, X-Gene’s performance should “surprise to the upside.” That said, there is currently no time table for X-Gene servers to be made publicly available for benchmarking.
Evercore Partners‘s Patrick Wang also is upbeat on Applied Micro today, writing that “Intel’s DCG [Data Center] business remains structurally challenged, and expect competition in LP server to intensify,” and that both Applied and ARM are “key beneficiaries” of Intel’s challenge.
Like Rolland, Wang thinks Calxeda’s departure is not a defeat for the overall ARM server movement, and he expects someone will buy Calxeda’s assets:
Mgmt confirmed plans to shut down as they literally ran out of money, likely unable to close its D round of financing. The company was founded under the Smooth Stone name in 2008 and raised a total $103mn of capital [...] We believe the LP server space will eventually be dominated by 3 or 4 major players by 2016. Other than Intel, other suitors include Samsung, Qualcomm, Broadcom, and Applied Micro [...] Along with Marvell, we believe Calxeda was actually ahead of the curve and perhaps too early to market as it didn’t exist. Further, they based their SOC roadmap on standard 32b ARM cores which is limiting their opportunities as the market runs on 64b code. They were planning to intersect the 64b market with the Lago SOC in 2H14 or perhaps later [...] Despite these challenges, we would be surprised if the Fleet Fabric IP isn’t quickly acquired by an opportunistic OEM partner, Web 2.0 customer, or competitor. Conceptually based on the industry standard Ethernet switch, the fabric roadmap was Calxeda’s strength, in our view [...] The fabric provides the basis for how the server chips talk to each other. Notably, AMD acquired SeaMicro ($334mn) just for their Freedom Fabric [...] While bears will use this as a talking point, there is absolutely no change to our view of the LP server opportunity. We expect the market to intensify next year led with 64b chips from Applied Micro followed by others (i.e., AMD, Cavium, Samsung, etc).
And William Blair’s Anil Doradla reiterates an Outperform rating on Cavium stock today, and he, too, thinks the Calxeda was a poor approach, the opportunity is still real for other chip makers, and that Cavium has the goods:
While some might believe Calxeda’s failure is a reflection of poor end-market demand for ARM-based servers, we strongly believe that it is a reflection of company-specific challenges rather than weak end-market demand. We believe greater emphasis on 32-bit ARM servers, lack of experience with large customers (both enterprise and service providers), and focus on lower core counts were some of the key reasons for Calxeda’s failure. We believe companies that have a track record with large enterprise customers and have expertise in higher core count processors are best positioned to succeed. The bottom line is that Cavium has both these attributes [...] We believe multicore processor vendors focused on providing higher core counts (higher than four cores) are best positioned to succeed in the market. We believe the ability to differentiate on price, size, and power from incumbent X86 architectures (Intel) is more pronounced at higher core counts. While there may be a 10% to 15% advantage in four core (or fewer) processors, we believe there is about 50% advantage (power or cost) at higher core counts (greater than eight cores). Within the multicore processor industry, Cavium and Broadcom (BRCM), through NetLogic, are vendors focused on the higher core count processors (other than Intel).
Why though? It is quite clear that business did not make sense.
How clear it can be.
Good way to justify your argument. This was a big name after Seamicro.
But this guy shows up once a while and will keep on arguing for no reason. This is in investment forum. He is most welcome to have a bearish view. But there should be facts to support argument.
We all having been arguing about the validity of ARMH servers. Then this news showed up. None of the bull created that news. Timing of that news killed their argument in its track.
You arrogance no limits. You equate yourself to HP and Dell of the world.
Come down to earth and argue like a civilized human being.
Intel a Standout Buy as Deutsche Curbs Chip Enthusiasm
By Tiernan Ray
Deutsche Bank’s Ross Seymore today cut his view of the semiconductor industry to Neutral from Overweight, writing that the 35% rise in the Philadelphia Semiconductor Index (SOX) means that chip stock valuations have “already baked in a strong recovery in 2014.”
The SOX is 3% below its five-year average versus the broader market, closing a 10% gap a year ago, observes Seymore.
Seymore’s one positive stance is on Intel (INTC), which he rates a Buy, with a $28 price target, stating that its valuation remains depressed on an historical basis.
After growth of 5% in total semiconductor revenue worldwide this year, 2014 may see growth of 8%, he thinks, helped by macroeconomic improvement boosting overall demand. What’s more, “relatively low capital intensity should limit supply growth with stable-to-improving ASPs,” he believes.
“By end-market/product segment we expect all categories to see growth in 2014, with improving conditions in Computing/Comms, stable growth in Autos and slowing in Industrial and Memory (after a strong 2013).”
However, “we see upside beyond our current estimate being unlikely as it already assumes the second best growth year in nearly a decade.”
Modoff notes that semiconductor inventory remains elevated, though some of that may burn away this quarter and next as production is throttled back by chip makers:
At the end of 3Q13 inventory on semiconductor companies’ balance sheets grew +4% q/q. DIOs increased three days q/q on a weighted basis but declined marginally on an un-weighted basis, still remaining above historical averages. On a weighted basis, 3Q DIOs at 87 days increased slightly (+1% q/q) and remained well above the historical average (81 days). Overall, DIOs were ~2% higher than the historical peak average (85 days). On an un-weighted basis, DIOs fell -1% q/q to 100 days in 3Q13 and remained well above the historical average of 93 days and near the historical peak of 102 days. We believe the primary reasons for continued high levels of DIOs is a combination of normal 3Q seasonality (initial preparation for 4Q demand) and eventual weaker-than- expected demand in 3Q/4Q caused by the still uncertain macro environment. Looking forward, semi companies have cut utilization in 4Q, and therefore a slight normalization in DIOs in 4Q13/1Q14. Customers are cautiously maintaining lower-level inventories as evidenced by channel inventory remaining flat q/q in 3Q, significantly lower than average seasonality of +4% q/q. As customer sales grow seasonally faster than their semiconductor suppliers in 4Q, slight channel inventory burn is expected but at a slow rate as end-demand remains tepid and visibility stays low. On an EV/Sales basis, most stocks under coverage have experienced multiple expansion, especially notable in the Analog group as evidenced by TXN, ADI, and LLTC. The EV/Sales largely ignores actual revenue/EPS growth and focuses on perceived benefits/risks of end market exposure as many of the companies with the best revenue growth over the past few years have experienced significant multiple compression and a number of companies that have not grown revenues have seen multiple expansion.
Valuations of chips stocks have expanded “significantly,” he writes:
Semiconductor valuations expanded significantly in 2013 on expectations of better fundamentals and a slowly improving macro backdrop. Today the group trades at an EV/TTM sales multiple of 2.7x, up +15% y/y from 2.3x a year ago. The current multiple is roughly 4% above the 5-year average (2008-2013). On a company-by-company basis, valuation multiples in the semiconductor industry diverge widely across both P/E and EV/Sales. The P/E is largely unrelated to operating performance and often reflects operating and/or financial leverage. This focus on end market exposure also is appearing to trump the historically high correlations between EV/Sales and gross margin (GM). We note many of the firms trading at a premium to their historical EV/Sales average have not experienced a significant improvement in GM. TXN, which has enjoyed significant multiple expansion and currently trades at a 50% premium to its 5yr average EV/S, has experienced a modest 100bps in GM expansion. Meanwhile, NXPI, which has grown GM +690 bps over the same period, only trades at a 12% premium to its 5yr average. Similarly, NXPI grew OM +740 bps while TXN’s OM dropped -340 bps over this period.
Regarding Intel, Seymore writes:
Intel trades near its historical low points on both P/S and P/E multiples. We believe further upside potential remains as investors see accelerating growth in 2H13. Our price target is based on an EV/S ratio of 2.2x our 2014 revenue estimate, a ~10% discount to the five-year average. On a P/E basis, our price target is based on ~12x our 2014E EPS. We note the straight P/E is well below the large-cap average within our coverage group (16x) and a discount to the broader market multiple (S&P500 at 14x CY14E).
Intel as one of the top pick from Jefferies
-------------
Today, Jefferies introduced a new product - Jefferies Franchise Picks - which represents the 20 highest conviction, Buy-rated ideas from the Jefferies US Research Team.
Stocks making the list:
Abbott Laboratories (NYSE: ABT) ($48 Target Price): Expect margin and multiple expansion. Splitting the company and/or additional capital return could also unlock value. Company deserves a higher multiple given their ability to continue to grow margins and because the lower multiple device business is only 20% of sales. Our 14/ 15 EPS ests are 9% and 18% above consensus.
Activision Blizzard, Inc. (NASDAQ: ATVI) ($23 Target Price): We believe the company offered conservative guidance around the Vivendi transaction, and that they re poised to benefit from the first console cycle in 7 years. We believe the '14 release slate looks very strong, with an important in-game policy change with the 2014 World of Warcraft release which should help to drive sales.
Agilent Technologies Inc. (NYSE: A) ($65 Target Price): We believe the company s F2014 EPS outlook is conservative, and believe numbers are finally beatable. Core EMG order growth has troughed, removing the key overhang on shares, and that should enable the market to properly value the two pieces-tech and life sciences.
Church & Dwight Co. Inc. (NYSE: CHD) ($75 Target Price): We expect F14 organic sales growth to accelerate to 4.5% from 2% in F13, as we transition from a very promotional year to one in which there's significant innovation. We're less concerned than the market about the launch of Tide Simply Clean, and our numbers are ahead of the Street for both 14 and 15.
Envision Healthcare Holdings (NYSE: EVHC) ($40 Target Price): Company is poised to benefit from healthcare reform implementation (i.e., less bad debt) and increased focus by hospitals on outsourcing (emergency room, ambulatory, physician services, etc.), a result of continued cost pressures on the industry. Acquisition of physician practices will also drive growth.
Fifth Third Bancorp (NASDAQ: FITB) ($23 Target Price): We like Ohio banks for loan growth potential, the ability to cut costs, and strong capital positions. We believe there s further room to cut costs, and that capital return should be among the best in the group. Despite all of that, the stock trades at a discount to the group on P/B and P/E.
Freeport-McMoRan (NYSE: FCX) ($45 Target Price): Believe there's excessive skepticism regarding the sustainability of high copper prices. We forecast $4.05 in EPS for 14, $5.00 for 15, and that compares to the Street s $3.16 for 14, and $3.36 for 15. Expect multiple expansion as the balance sheet is deleveraged, production volumes and margins expand.
GNC Holdings Inc (NYSE: GNC) ($68 Target Price): We're more optimistic than the Street on the company s ability to continue to drive comps with their Gold Card program. We expect a 4-5% comp lift from the Gold Card in
14, resulting in an 11% overall comp. Stock trades at about 16x our above consensus 14 estimate, and we expect EPS growth of 20%+ in both '14 and '15.
Huntsman Corporation (NYSE: HUN) ($28 Target Price): Stock trades at less than 10x EPS, despite what we believe will be 10%+ EPS growth through 2015. Drivers include Rockwood deal accretion, a tighter MDI market in 14, normalization of TiO2, restructuring savings, and growth projects. We see $4.00 in EPS in a "blue sky" case.
Ingersoll-Rand Plc (NYSE: IR) ($68 Target Price): The company should benefit from both an improved HVAC cycle, and productivity programs which should enhance margins. Street looks for only 4% 2014 growth in the Climate business, which is likely conservative given pent-up residential demand, and improving commercial demand. Believe they could earn as much as $4.50-$5.00 per year this cycle.
Intel Corporation (INTC) ($32 Target Price): Well positioned to capture share in low-cost mobile devices after three years of flat to down growth. We don t think lower priced chips will hurt gross margins. There's further support from better corporate PC growth, strong enterprise PC and bottoming consumer markets in NA and Western Europe.
Jack in the Box Inc. (NASDAQ: JACK) ($53 Target Price): We expect continued SSS outperformance at Jack in the Box (JIB) via speed of service & new food news. Meanwhile, we see substantial upside opportunity at Qdoba as the topline accelerates & margins move higher. Assuming the JIB business trades at about 10.5x C14 EBITDA (vs. peers like SONC at 11x or more), this implies a trough-multiple of about 5x for Qdoba vs. fast casual peers trading at 10-20x.
Kohl's Corp. (NYSE: KSS) ($65 Target Price) - We see upside to C2014 comps and EPS on improved merchandising (new teams introduced product in spring of 13), an expanded loyalty program, and an improved marketing message from their new Chief Customer Officer. Additionally, management has the opportunity to increase share buybacks given robust free cash flow and better inventory management.
ManpowerGroup Inc. (NYSE: MAN) ($89 Target Price): Company benefits from a combination of an improvement in Europe, and a restructuring program which can drive EBITA margins to 4% " a level still well below Randstad's 5-6% goal. We believe they can hit 4% EBITA margins which equates to proforma 2015 EPS of $6.50-$7 vs. consensus of $5.35.
Micron Technology Inc. (NYSE: MU) ($30 Target Price): Our 2014 EPS estimates are nearly 50% ahead of the Street, based largely on our outlook for muted DRAM supply. We believe that Samsung is less interested in expanding DRAM capacity, as a less competitive TSMC in Foundry would enable them to reap even larger profits in their semi and smartphone businesses longer term.
Microsoft (NASDAQ: MSFT) ($42 Target Price): " Our analysis on Office 365 suggests it could add ~3% CAGR to Office revenue over the next nine years; Office is 55% of our enterprise value estimate. We see compelling restructuring opportunities given low revenue per employee and high cost per employee. Recent signs of improvement in corporate PCs are yet another positive.
Newfield Exploration Co. (NYSE: NFX) ($41 Target Price): We believe investors underappreciate the Cana Woodford opportunity, as investors instead focus on the Bakken, Utica and the Eagle Ford. Cana exposure is increasing through acquisitions and as they sell international assets. The next catalyst is the 2013 reserve report in Feb, and the possible sale of their Chinese acreage in mid-2014.
Oceaneering International, Inc. (NYSE: OII) ($41 Target Price): We're above the Street for both 14 and 15. We re less concerned than the market about the Gulf of Mexico, where we expect 15% growth in active rigs in 14, and point out that orders for OII s production related equipment lag those for subsea trees, a positive given strength in subsea trees in 13
Restoration Hardware Holdings, Inc. (NYSE: RH) ($88 Target Price): Our real estate transformation analysis gives us confidence in our four-year EPS CAGR of 36% and we believe $6 in EPS is attainable in F18 (vs F15 cons of $2.18). Early indications of the real estate plan show at least 2x the sales new full line design galleries versus the stores they replaced. We model 10% comps in F15 (Jan) our EPS are ahead of the Street, and we believe comps could be as high as 15%
SolarWinds, Inc. (NYSE: SWI) ($45 Target Price): Company has missed numbers twice this year, and recently guided CY14 margin guidance below consensus, which now embeds a 900-1000bps decline in operating margins. We believe revenue and margin guidance are very conservative, and that the company has taken recent steps including sales capacity expansion to position for growth reacceleration in CY14. We also point out that the stock trades at about 15x FCF, despite 15-20% FCF growth " rare for a growth company.
Copyright 2013, Street Insider News Provided by Acquire Media Corporation
I do agree with your point of view. He is civilized, no doubt about.
Finally you admitted that it is a low probability. It has been long time coming. That is why Intel introduced Avaton series of servers chip. Low probability and very low volume where these could be used.
Dmcq,
Do you really know what google pays to Intel for these processors, even for a second I assume your argument? I know for sure the performance is not 10% higher. Show me which ARMH processor is half of Intel processor.
You are just daydreaming and arguing for sake of argument.
In response to your rebuttal in comments column, one had mentioned that Google could buy one of these companies to get a head start. If that was the case, then AMCC should have jumped 10%. Also AMD should have jumped today also on that news as it is entering servers market with ARMH.
Let us presume for a second that Google and Facebook and other servers customers will go to eventually ARMH, then what will happen to AMCC, NVDA, Cavium, AMD, Samsung who are planning to introduce ARMH servers chip. These companies have no place to exist.
How come AMCC is down big time and Intel was down a little?
AMCC was one option that Google could use to get into server business quickly by buying AMCC outright.
-----------
ARM rises, Intel slips, AppliedMicro dives following Google CPU report • 6:31 PM
With ARM-based (ARMH +2.6%) CPUs currently having a minimal presence in the massive server CPU market, a report that Google is thinking of developing its own ARM-based server CPUs has gone over well with ARM investors.
In addition to Google, Facebook has shown an interest in ARM. A recent post from a Facebook developer suggests the company is working to port some of its internal software for use with ARM CPUs.
AppliedMicro (AMCC -4.6%), an early leader in the ARM server CPU space (courtesy of its X-Gene chips), wound up selling off after opening higher. There may be concerns Google will open-source its CPU designs to help foster a broader ecosystem for them, as it has done with many pieces of software. AMD, Marvell, and private Calxeda are also targeting the ARM server CPU market.
Intel (INTC -0.7%), whose server CPU division had a $1.39B Q3 op. profit on the back of 12% Y/Y rev. growth, finished down modestly. Google/Facebook would act as big reference wins for ARM, which still face major software ecosystem challenges as it tries to grow its server presence. Intel is trying to counter ARM with its low-power Avoton Atom server CPUs.
FBR, which just started coverage on ARM with an Outperform, thinks ARM-based designs could grab 10% of the server CPU market by 2018, thanks to a 50% share in the fast-growing microserver segment.
Read comments
It is not shocking. Competition was always there. Sometimes it is weak and at times it is strong. There is not a single industry where monopoly exists.
Pile on while things are fresh in folks's mind. Who is next Amazon and then Microsoft and Yahoo.
Why don't you tell Intel to close its door and hang up?
In a few days 2014 is upon us. Where is server chip from this company? No where. May be one day it will have to compete against Intel.
Anyway one looks at it, it is just normal negotiating tactics to get better prices. It was quite clear in Intel CC that it was doing customs designs for top customers like GOOG, FB, AMZN etc
That is it. IDF brought stock down for 2-3 weeks and now this will do the same. Dec. options expiration is next week. Some big time hedge is taking place.
But ARMH stock was down today with down market.
Here it is-Imagination Tech. article.
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Imagination checked by Arm’s strength
By Sally Davies
What’s in a name? As shares in microchip designer Imagination Technologies dived 20 per cent on Wednesday, investors seemed to think that the title said less about laudable ambition and more about undue optimism over the company’s decision to take the battle to Arm.
Imagination, whose strength is in graphics technology, blamed a slowing market in high-end smartphones for disappointing half-year results to the end of October. Revenues were below expectations at £85.2m, and Imagination revised downwards the number of chips its partners expect to ship for the full year.
“There will continue to be fluctuations and changes in the markets in which we operate, but we are confident that our strong and comprehensive IP families, and the solution-centric platforms they are enabling, will allow us to take advantage of the numerous growth opportunities ahead,” chief executive Sir Hossein Yassaie said.
Profit before tax fell year-on-year in the period from £10.4m to £2.2m, pulling down earnings per share from 3p to a loss of 0.4p.
The Hertfordshire-based company makes most of its money from licensing and royalties. Apple devices use half of the chips made with Imagination’s intellectual property.
But much of the growth in the smartphone market now comes from lower-cost handsets, particularly in China. Analysts say that Arm has moved quicker than Imagination in designing chips for these cheaper, less powerful phones.
“Arm has undoubtedly flipped Imagination at the low end – perhaps on price, perhaps on a reduced function set,” said Lee Simpson, analyst at Jefferies.
“Now they’re seeing their customer base asking them to address that space, but they’re coming to that market as the second player.”
But other analysts say that the company’s decision not to focus on chips for less powerful devices is correct.
“Growth in low-end in any market is only attractive in the short term,” said Nick James of Numis. “Prices get eroded and it all just becomes a race to the bottom.”
Imagination was also hurt by some of its chipmaking customers, such as Renesas and Texas Instruments, pulling away from smartphones and tablets.
The company is banking on investments in central processing units and communications technology to take advantage of an era of connected devices, often called “The Internet of Things”.
Its longer-term gambits include the February acquisition of lossmaking US company MIPS that places Imagination more squarely at odds with Arm in CPU design.
“No market likes a monopoly; the advantage for Arm is that they haven’t had a real competitor,” said Sir Hossein, saying that the advantage of the MIPS technology is its efficiency, size and low power consumption.
But it will be hard to crack Arm’s market dominance. “It’s a slow process of pulling back Arm’s tight fingers in this market, and there’s no guarantee that they’re going to do it,” said Mr Simpson.
http://us.rd.yahoo.com/finance/external/ft/SIG=129slnpc8/*http://www.ft.com/cms/s/f654ce82-625d-11e3-99d1-00144feabdc0,s01=1.html
Imagination Technology was down big time as sales of High end cell phones are falling big time. This is the first shoe that has fallen. Next one is ARMH to fall.
I can't find the article that I read this morning. I will still look for though.
I went to MS store and HP 10" tablet Omni 10 had Z357)(I think it is Baytrail). How would buy HP tablet with Marvel device? May be in Europe some will go for that for price only.
HP is trying to throw everything and hoping something will work.