Intel Corp (INTC)

[Sarmad]

>> I hope it's baked in to the $14-15 range.

Regarding stock price, I expect the key question is level of inventory, both at Intel, and with customers. I don't think analysts will trust any answer Intel gives to that question, so they will make their calls to serve whatever suits them.

So far I have not seen how Intel's will not have large over-capacity, considering it has six high volume production fabs (three 65nm, three 45nm), plus the development fab. Even if AMD's share goes to zero, that's still too much capacity.

Even before ramping the third production 45nm fab, Intel was able to sell $11B of parts. if sales now are in the $8B range, and AMD's CPU sales are in the $1B range, then there is a whole fab that is excess.

By adding three 45 nm fabs within two years, and not closing any 65 nm fabs, Intel would have excess capacity, even if demand had stayed at '07 levels. At 25% reduced demand, there has to be either huge inventory build, or some idle capacity. Has Intel said anything about the subject ?