Wednesday, April 14, 2010

Intel Results Boost Confidence in Microsoft $INTC $MSFT PRICE TARGET $32

IntelCredit Suisse reiterate a Outperform rating on INTC based on our belief that the company is well positioned to benefit from (1) Rebound in enterprise IT spending (60%+ of revs) driven by an aging corporate desktop (~5 yrs) and notebook (~4 yrs) installed base, (2) Accelerating PC growth especially in emerging markets, (3) Strong Nehalem driven server cycle in volume (Dual-Processor or Nehalem/Westmere EP) and high performance (Multiprocessor or Nehalem EX), and (4) Ramp of higher margin 32nm products in 2010/11 with manufacturing, cost and performance advantages over competition. Concerns on the stock continue to be dominated by inventory double ordering, weak enterprise PC demand, weakening product mix driven in part by Intel Atom’s “goodenough” computing and the mix-shift towards consumer PCs, and lastly, increased
competition from ARM processor based low-end netbooks.

Intel Results Boost Confidence in Microsoft
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