Intel Corp (INTC)

[The Duke of URL]

Let me be more nearly clear:

INTEL earned $4.2 billion (up 21%) on sales of $18.7 billion (up 16%) in the first half of 2005, dwarfing AMD, which lost $6 million (versus a $77 million gain the year before) on flat sales of $2.5 billion. The giant trades at a trailing price/earnings ratio of 20 while AMD carries a multiple of 1,000, based on its mere two pennies per share earnings.

Still, struggling AMD is the smart pick, insists William Fleckenstein, president of Fleckenstein Capital, a Seattle hedge fund. He predicts the market will wake up to the fact that AMD makes better, faster chips. Intel, he says, awes everyone with its near-monopoly status, but "they are just a marketing machine."

Intel still holds a commanding 84% share of total PC and low-end servers. But Fleckenstein says AMD will wrest away a few points, especially if its antitrust suit produces a settlement or judgment that hobbles Intel. So he is shorting Intel and buying AMD.