The Death of the PC and Intel (INTC)

In the case of specific industries, for instance in the airline industry, it’s absolutely true that a young analyst, looking at things fresh–if he is as hardworking as I was and in really willing to dig in–has a tremendous advantage over me. I will always believe, by the way , that in hiring analysts, the best guys are the ones with two or three years’ experience. Probably from a poor background–hungry, cynical, skeptical, taking nothing for granted. As concerns an industry, it is absolutely true.

However, as concerns the big issues–interest rates, what I call the universal issues–I won’t defer to anybody, because knowledge of history is so important. You have to an historian, not a ‘quant.’ Really, in those issues, there is nothing new under the sun. –Joe Rosenberg (Interview Grant’s Pub. April 6, 1987)

Intel

Yes, the news is out–there is weaker than expected demand in the Personal Computer unit as the global economy and Tablet sales depress Intel’s business, for now.

But with these financials INTC_VL Oct 2012 and the current price and INTC_35 Yr, I will take a look. I pray for a negative earnings report to send the price lower, but you should first value the entire company. What are you getting for your dollar?  The strong balance sheet (excess cash), return on total capital of 18%, 4% dividend yield (the company is paying out about 40% of its profits to its shareholders) and earnings yield of about 10% are what interest me.  I bet the PC industry will not disappear at the rate the market may be projecting, but do I really know that?

Update on Oct. 23rd, 2012: Death of the PC Articles