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Posts with tag notebooks

Intel (INTC) still has the intelligence edge

Readers of this space know that the investment bias is toward large-cap companies with demonstrated business models and a competitive advantage in established markets, preferably with a favorable global trend as a support. With this in mind, Intel is worth an evaluation.

Intel (NASDAQ: INTC) is the world's largest semiconductor maker, as measured by revenue and unit shipments, and is the dominant microprocessor manufacturer for personal computers.

In general, analysts expect F2008 revenue to increase 5-7%, after an 8% increase in F2007. The conventional wisdom in semiconductor analysis land now suggests that smaller/more-portable computer forms and media-rich PDAs will drive strong PC and PDA microprocessor sales.

Further, Intel remains the leader in next-generation chip technology, and its product mix remains superior. Gross margins should increase, as a result of lower unit costs and improved plant utilization. Also, high-performance chip prices should increase noticeably.

Continue reading Intel (INTC) still has the intelligence edge

Apple (AAPL) notebook sales keep growing

Apple, Inc. (NASDAQ: AAPL) gets a ton of press about its ever-popular iPod, but the company makes darn good desktops and notebook PCs too. In fact, the growth of this product segment has been credited in recent years to the 'halo effect' of the iPod: as more consumers buy iPods, they end up buying a Mac as their next computer.

A Bernstein Research analyst notes that Apple's global PC market share has gone up in 10 of the last 11 quarters. In a PC market that continues to find growth as more customers replace older machines and emerging countries buy more new machines, this feat is pretty impressive. Here's the kicker: Apple's U.S. notebook sales have made up about 47% of Apple's Macintosh PC unit growth and 52% of its revenue growth in the company's most recent quarter. Now, which tail is wagging the dog here?

Perhaps it was not Steve Jobs' intention to generate such a spike in Mac sales from such products like the iPhone and the newer iPods, but that may be what is just happening. Apple enjoys a very decent margin on its PC systems, so this is probably a relief to Apple's bean counters.

The problem noted in the report is that Apple's share of the market it likes to play in -- the higher-priced PC market -- is already high, so there is little room for growth there. I doubt Apple would price-commoditize its PCs to the bargain-basement level of Gateway and Acer, so is growth doomed to slow down soon?

Dell's decline is amazing

Who would have thought five years ago that Hewlett Packard Co. (Nasdaq:HPQ) would not only be beating Dell Inc. (Nasdaq:DELL) in the PC market but that it would also extend its lead?

As PC remained lackluster in the fourth quarter, HP managed to boost sales by 24% as Dell's sales fell 9%, the Associated Press reported, citing data from Gartner Inc. HP had 17% of the market to Dell's 14%.

"This level of decline is unprecedented in Dell's history," Gartner analyst Charles Smulders told Bloomberg News.

As a self-described technology idiot, I have a theory for Dell's problems: hubris. The last time my wife and I priced a PC, we went through Dell's Web site. Our friend did the same thing. We wound up getting different prices for the same machine. It was just too confusing to figure out.

When it was time to get an upgrade, we went with an H-P.

Wall Street is starting to lose its patience with Michael Dell and Kevin Rollins. Shares of Dell have plunged 16% over the past year while HP has soared 33%. Even Sun Microsystems Inc. (Nasdaq:SUNW) has outperformed Dell.

I wonder what it will take for Dell to get out of Wall Street's dog house.

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DJIA+73.0311,288.54
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S&P 500+1.381,262.90

Last updated: July 05, 2008: 07:22 PM

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