Replies to post #70039 on Intel Corp (INTC)

[techno_bull]

Following those previous drops the compelling part had been that 'INTC must once again trade at an 18 PE', so we kept saying the stock must be cheap. But now I believe that we can throw out the 'compelling PE' argument and that the 'compelling yield' argument will provide a floor for the stock at around $12. I'm not making a general call that all stocks with >%4 yield have a floor under them. Just that I believe INTC with no exposure to the credit markets and yielding >4% has a floor under it, IMO.

[smooth2o]

Saturn: I am wondering if I should go on margin now and buy now.

Well, you know, now is the time to use margin, not when the market is at a top... However, I would agree that it's hard to tell what is going to happen. Another 1000 points on the DOW will put the market at what it was in the dot bomb. That would be to say the intrinsic value of corporations has not grown in the last eight years. That's hard to fathom. So, I'm not expecting a whole lot of downside from here. It would also say that companies like Intel are experiencing something worse than they did in 2000. Then, they expected no sales so you could expect the lower valuations. Here, it's a credit crisis and they have plenty of cash. You can't argue that the consumer sales might be down, but other sales might be up. Just like always, it's different this time....

Smooth

[Koog]

Saturn,

You're a smart guy and I always appreciate your posts. In my opinion, this market is not like anything any of us has seen before. The "rules" and expected market moves no longer apply. Maybe some day in the future but not now. I believe there's going to be a lot more pain for quite a while before we can say a bottom was placed (in hindsight).

I sure can't tell you what to do, but I am very happy that I am not on margin now.