Intel Corp. (NASDAQ: INTC) came out Monday night and warned of lower margins, and while the stock was down in after-hours trading, one might actually make the argument that this might not be such bad news for its core operations. It's just hard to be too much like Dr. Pangloss in what looks, feels, and even smells more and more like a bear market each week. The culprit is listed as "lower than expected NAND flash memory chip prices." So Intel said it is now looking for 54% margins, plus or minus 1%. Its previous guidance was 56%, plus or minus 1%. What is at least a bit of relief here is that Intel said that all other expectations are consistent with the prior guidance given with its last outlook.

I would note that Intel had recently been downgraded at Goldman Sachs and at AmTech. Arguably, this is the second warning if you count last quarter. Its 2% drop is fairly appropriate as that is basically how much the stock is down on the news. Intel closed up 0.2% Monday at $20.01, but it was now seeing shares trade down 2.5% at $19.51 in after-hours evening trades.

If you take this at face value, Intel at least has a robust processor business, or at least it has the best processors in the industry. This news is taking a toll on other semiconductor stocks as well, but as the news bit is specific to NAND flash memory chips, it is hitting those flash memory stocks the worst of the others.

Micron Tech (NYSE: MU) is one that won't be liking this as its turnaround seems to be in jeopardy. This may at least make the company pursue more active issues like divesting some assets. SanDisk Corp. (NASDAQ: SNDK) is perhaps the pure-play for flash memory stocks, and its shares were actually down almost 3.5% at $22.25 in after-hours trading. That was after already hitting a new 52-week low at the close of $23.05 as its trading range over the last year was $23.40 to $59.75. Spansion Inc. (NASDAQ: SPSN) is another go-to stock in flash memory. Its shares were down almost 3% in after-hours trading at $2.82 after having an almost 6% gain today. Unfortunately, it has had a poor year with its 52-week trading being $2.69 to $12.83.

MOST NOTEWORTHY: Micron, Chico's FAS and Lifetime Brands were today's noteworthy initiations:

• Oppenheimer assumed Micron (NYSE: MU) with an Outperform rating and $9.50 target, as they believe price declines in the DRAM market moderated in 2H of the December quarter and that concerns of oversupply are already priced into shares.
  
• Stanford believes shares of Chico's FAS (NYSE: CHS) will remain under pressure over the next three to six months given the adverse economic conditions and the company's "less-than-exciting" fashion assortment. The firm started shares with a Hold rating and $10 target.
  
• Lifetime Brands (NASDAQ: LCUT) was initiated with a Neutral rating at SunTrust. The firm prefers to wait for greater visibility on the U.S. consumer spending environment before becoming more constructive on the name.

OTHER INITIATIONS:

• Soleil initiated Worthington (NYSE: WOR) with a Hold rating.
  
• Jefferies started Esterline Technologies (NYSE: ESL) with a Buy rating and $58 target.
  
• Oppenheimer assumed Spansion (NASDAQ: SPSN) with a Perform rating.

MOST NOTEWORTHY: SanDisk (SNDK), Indevus Pharmaceuticals (IDEV), Integra LifeSciences (IART) and Level 3 Communications (LVLT) were today's noteworthy initiations:

• SanDisk (NASDAQ: SNDK) was initiated with a Neutral rating at Cowen, as the firm believes it could face challenges in Q4 NAND flash memory demand given supply.

• Rodman & Renshaw initiated shares of Indevus (NASDAQ: IDEV) with a Market Outperform rating and $10 target. The firm believes Indevus Nebibo and Sanctura XR upcoming events provide an attractive entry point.

• Morgan Stanley initiated shares of Integra LifeSciences (NASDAQ: IART) with an Equal Weight rating and $55 target, citing competitive risks from larger competitors.

• Shares of Level 3 Communications (NASDAQ: LVLT) were initiated at Raymond James with an Underperform rating, as the firm believes estimates will be difficult to achieve given high debt levels and free cash flow.

OTHER INITIATIONS:

• Cowen initiated shares of STEC Inc (NASDAQ: STEC) and Spansion (NASDAQ: SPSN) with Neutral ratings and shares of Silicon Motion Technology Corp (NASDAQ: SIMO) with an Outperform rating.

• Pacific Crest initiated shares of Universal Electronics (NASDAQ: UEIC) with a Sector Perform rating on valuation.

• Merrill Lynch started shares of FirstFed Financial (NYSE: FED) with a Sell rating.

• Goldman Sachs started shares of Herbalife (NYSE: HLF) with a Buy rating and $50 target.

Analyst summaries provided by TheFlyOnTheWall.com (subscription required).